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Urban Growth

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Author Info
Duncan Black
Vernon Henderson

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Abstract

This paper models and examines empirically the evolution of cities in an economy. Twentieth century evolution in the USA is characterized by parallel growth of cities of different types and on-going entry of new cities, together maintaining a stable relative size distribution of cities. Each type of city has a particular industrial composition and good(s) it specializes in and corresponding equilibrium size. This evolution is modeled in an economy with exogenous population growth and endogenous human capital accumulation. Within cities, there are knowledge spillovers as well as scale externalities. Individual city sizes grow with human capital accumulation; and cities grow in number if national population growth is high enough. Different types of cities grow in parallel in size and human capital accumulation. However, per capita income and human capital levels differ across city types by production process and benefits of human investments and spillovers, so there is observed inequality across cities among otherwise identical individuals.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 6008.

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Date of creation: Apr 1997
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Handle: RePEc:nbr:nberwo:6008

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Find related papers by JEL classification:
O4 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
R00 - Urban, Rural, and Regional Economics - - General - - - General

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  1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-37, October. [Downloadable!] (restricted)
  2. Jonathan Eaton & Zvi Eckstein, 1994. "Cities and Growth: Theory and Evidence from France and Japan," NBER Working Papers 4612, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  3. Benabou, R., 1992. "Heterogeneity, Stratification, and Growth," Working papers 93-4, Massachusetts Institute of Technology (MIT), Department of Economics.
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  4. Henderson, J V, 1974. "The Sizes and Types of Cities," American Economic Review, American Economic Association, vol. 64(4), pages 640-56, September. [Downloadable!] (restricted)
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  5. Helsley, Robert W. & Strange, William C., 1990. "Matching and agglomeration economies in a system of cities," Regional Science and Urban Economics, Elsevier, vol. 20(2), pages 189-212, September. [Downloadable!] (restricted)
  6. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages S71-102, October. [Downloadable!] (restricted)
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  7. Flatters, Frank & Henderson, Vernon & Mieszkowski, Peter, 1974. "Public goods, efficiency, and regional fiscal equalization," Journal of Public Economics, Elsevier, vol. 3(2), pages 99-112, May. [Downloadable!] (restricted)
  8. Roland Benabou, 1991. "Workings of a City: Location, Education, and Production," NBER Technical Working Papers 0113, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  9. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June. [Downloadable!] (restricted)
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  10. Upton, Charles, 1981. "An equilibrium model of city size," Journal of Urban Economics, Elsevier, vol. 10(1), pages 15-36, July. [Downloadable!] (restricted)
  11. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July. [Downloadable!] (restricted)
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