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By Richard J. Arnott, Daniel P. McMillen

ISBN-10: 1405106298

ISBN-13: 9781405106290

A significant other to city Economics offers a state of the art review of this box, speaking its highbrow richness via a various portfolio of authors and subject matters. precise in either its rigor and overseas therapy an excellent supplementary textbook in upper-level undergraduate city economics classes, or in master's point classes, supplying scholars with the required beginning to take on extra complicated subject matters in city economics includes contributions from the world’s major city economists

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Extra info for A companion to urban economics

Example text

This makes it possible to measure total employment and own-industry employment within a certain distance of an employer. Using these measures, it is possible to calculate the effects of the local environment on the number of firm births and on these new firms’ employment levels for six industries (computer software, apparel, food processing, printing and publishing, machinery, and fabricated metals). 4. The figure graphically shows that agglomeration economies attenuate with distance. The level of employment chosen by newly arrived firms increases when employment increases in the firm’s industry within 1 mile of the firm’s zip code.

4. Finally, Rosenthal and Strange (2003) examine the location decisions of new plants in a model of plant births. The intuition is that if agglomeration enhances productivity, additional plants will be drawn to agglomerated areas. The key findings are that diversity attracts new arrivals, and that localization economies are more important than urbanization economies for the six industries studied. It is important to recognize that in all of the studies discussed above it is difficult to be certain about causality.

This pattern is repeated for other concentrated industries. A third benefit of agglomeration is labor-market pooling. This occurs when firms are able to acquire specialized labor by locating near other firms in the same industry. 3, benefits from this. Pooling labor reduces risk for both workers and employers alike by reducing search costs and enhancing the match quality between workers and jobs. For example, if a carpet producer in a remote area were to fail, workers who had developed industry specific skills might have to relocate in order to find comparable jobs.

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A companion to urban economics by Richard J. Arnott, Daniel P. McMillen


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