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Central Cities as Engines of Metropolitan Area Growth

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  • Albert Solé‐Ollé
  • Elisabet Viladecans‐Marsal

Abstract

The paper analyzes the role of central cities as engines of economic growth in their metropolitan area. We wonder if there are increasing returns to central city growth at the metropolitan level arising from the positive externalities associated with the unique features of central cities. To answer this question we analyze the causality between the economic growth of Spanish central cities and the growth of the other jurisdictions belonging to their metropolitan area (i.e., the suburbs). The analysis uses population and economic activity data for a sample of 28 Spanish metropolitan areas during 35 years. We use a Vector Error Correction Model (VECM) framework to estimate long‐run equilibrium relationships between the growth of central cities and their suburbs. The combination of panel data and a VECM is an innovative approach that is still being developed in econometrics. The results suggest that central city growth has a long‐run positive effect on the growth of the suburbs. We also inquire as to whether or not this positive effect depends on the size of the central city. The results suggest that the effect is much higher in the case of the largest cities, but that it is also important in the case of the smaller ones.

Suggested Citation

  • Albert Solé‐Ollé & Elisabet Viladecans‐Marsal, 2004. "Central Cities as Engines of Metropolitan Area Growth," Journal of Regional Science, Wiley Blackwell, vol. 44(2), pages 321-350, May.
    • Handle: RePEc:bla:jregsc:v:44:y:2004:i:2:p:321-350
    DOI: 10.1111/j.0022-4146.2004.00339.x
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    Cited by:

    1. Combes, Pierre-Philippe & Gobillon, Laurent, 2015. "The Empirics of Agglomeration Economies," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 247-348, Elsevier.
    2. Sole-Olle, Albert, 2006. "Expenditure spillovers and fiscal interactions: Empirical evidence from local governments in Spain," Journal of Urban Economics, Elsevier, vol. 59(1), pages 32-53, January.
    3. Albert Solé-Ollé & Elisabet Viladecans-Marsal, 2007. "Economic and political determinants of urban expansion: Exploring the local connection," Working Papers 2007/5, Institut d'Economia de Barcelona (IEB).
    4. Albert Solé-Ollé & Núria Bosch, 2005. "On the Relationship between Authority Size and the Costs of Providing Local Services: Lessons for the Design of Intergovernmental Transfers in Spain," Public Finance Review, , vol. 33(3), pages 343-384, May.
    5. Albert Solé-Ollé & Elisabet Viladecans-Marsal, 2007. "Economic and political determinants of urban expansion: Exploring the local connection," Working Papers 2007/5, Institut d'Economia de Barcelona (IEB).
    6. Bella, Giovanni & Massidda, Carla & Mattana, Paolo, 2014. "The relationship among CO2 emissions, electricity power consumption and GDP in OECD countries," Journal of Policy Modeling, Elsevier, vol. 36(6), pages 970-985.
    7. Andrew F. Haughwout, 2010. "Management Of Large City Regions: Designing Efficient Metropolitan Fiscal Policies," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 401-421, February.
    8. Shu‐Hen Chiang, 2012. "The Source of Metropolitan Growth: The Role of Commuting," Growth and Change, Wiley Blackwell, vol. 43(1), pages 143-166, March.
    9. Elisabet Viladecans-Marsal & Josep-Maria Arauzo-Carod, 2012. "Can a knowledge-based cluster be created? The case of the Barcelona 22@ district," Papers in Regional Science, Wiley Blackwell, vol. 91(2), pages 377-400, June.
    10. Miquel- Àngel Garcia-López & Adelheid Holl & Elisabet Viladecans-Marsal, 2013. "Suburbanization and highways: when the romans, the bourbons and the first cars still shape Spanish cities," Working Papers 2013/5, Institut d'Economia de Barcelona (IEB).
    11. Shu-hen Chiang, 2018. "Assessing the Merits of the Urban-Led Policy in China: Spread or Backwash Effect?," Sustainability, MDPI, vol. 10(2), pages 1-14, February.
    12. Shu-Hen Chiang, 2014. "The dilemma of "Twin Cities": is the suburban dependence hypothesis applicable?," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 17(2), pages 149-163, June.
    13. Josep-Maria Arauzo-Carod & Elisabet Viladecans-Marsal, 2009. "Industrial Location at the Intra-Metropolitan Level: The Role of Agglomeration Economies," Regional Studies, Taylor & Francis Journals, vol. 43(4), pages 545-558.
    14. Elisabet Viladecans Marsal & Josep Maria Arauzo Carod, "undated". "Industrial Location at the Intra-metropolitan Level: A Negative Binomial Approach," Studies on the Spanish Economy 224, FEDEA.
    15. Miquel- Àngel Garcia-López & Adelheid Holl & Elisabet Viladecans-Marsal, 2013. "Suburbanization and highways: when the romans, the bourbons and the first cars still shape Spanish cities," Working Papers 2013/5, Institut d'Economia de Barcelona (IEB).

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