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Edward L. Glaeser's
Scholarly Papers
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33,470 |
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4,113 |
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1.
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The New Comparative Economics
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Simeon Djankov Ministry of Finance Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Florencio Lopez de Silanes EDHEC Business School Rafael La Porta Tuck School of Business at Dartmouth Andrei Shleifer Harvard University - Department of Economics
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05 Apr 03
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21 Dec 04
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2,328 ( 1,044) |
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Simeon Djankov Ministry of Finance Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Florencio Lopez de Silanes EDHEC Business School Rafael La Porta Tuck School of Business at Dartmouth Andrei Shleifer Harvard University - Department of Economics
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17 Jun 03
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19 Jun 03
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In recent years, comparative economics experienced a revival, with a new focus on comparing capitalist economies. The theme of the new research is that institutions exert a profound influence on economic development. We argue that, to understand capitalist institutions, one needs to understand the basic trade-off between the costs of disorder and those of dictatorship. We then apply this logic to study the structure of efficient institutions, the consequences of colonial transplantation, and the politics of institutional choice.
Comparative economics, institutions, colonial transplantations, transition
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Simeon Djankov Ministry of Finance Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Florencio Lopez de Silanes EDHEC Business School Rafael La Porta Tuck School of Business at Dartmouth Andrei Shleifer Harvard University - Department of Economics
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05 Apr 03
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17 Jun 03
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Abstract:
In recent years, comparative economics experienced a revival, with a new focus on comparing capitalist economies. The theme of the new research is that institutions exert a profound influence on economic development. We argue that, to understand capitalist institutions, one needs to understand the basic tradeoff between the costs of disorder and those of dictatorship. We then apply this logic to study the structure of efficient institutions, the consequences of colonial transplantation, and the politics of institutional choice.
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Andrei Shleifer Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Florencio Lopez de Silanes EDHEC Business School Rafael La Porta Tuck School of Business at Dartmouth Simeon Djankov Ministry of Finance
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21 Dec 04
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21 Dec 04
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2,267
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In recent years, comparative economics experienced a revival, with a new focus on comparing capitalist economies. The theme of the new research is that institutions exert a profound influence on economic development. The authors argue that, to understand capitalist institutions, one needs to understand the basic tradeoff between the costs of disorder and those of dictatorship. They then apply this logic to study the structure of efficient institutions, the consequences of colonial transplantation, and the politics of institutional choice. This paper - a product of the Private Sector Advisory Department, Private Sector Development Vice Presidency - is part of a larger effort to understand institutional differences in the regulation of business.
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2.
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Myths and Realities of American Political Geography
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bryce Adam Ward Harvard University - Faculty of Arts and Sciences
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10 Jan 06
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10 Jun 09
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1,427 ( 2,647) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bryce Adam Ward Harvard University - Faculty of Arts and Sciences
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10 Jan 06
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14 Sep 06
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The division of America into red states and blue states misleadingly suggests that states are split into two camps, but along most dimensions, like political orientation, states are on a continuum. By historical standards, the number of swing states is not particularly low, and America's cultural divisions are not increasing. But despite the flaws of the red state/blue state framework, it does contain two profound truths. First, the heterogeneity of beliefs and attitudes across the United States is enormous and has always been so. Second, political divisions are becoming increasingly religious and cultural. The rise of religious politics is not without precedent, but rather returns us to the pre-New Deal norm. Religious political divisions are so common because religious groups provide politicians the opportunity to send targeted messages that excite their base.
Economics - Economic and Econometric Theory, Electoral Politics, Political Science, Press and Public Policy
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bryce Adam Ward Harvard University - Faculty of Arts and Sciences
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05 Apr 06
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10 Jun 09
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Abstract:
The division of America into red states and blue states misleadingly suggests that states are split into two camps, but along most dimensions, like political orientation, states are on a continuum. By historical standards, the number of swing states is not particularly low, and America's cultural divisions are not increasing. But despite the flaws of the red state/blue state framework, it does contain two profound truths. First, the heterogeneity of beliefs and attitudes across the United States is enormous and has always been so. Second, political divisions are becoming increasingly religious and cultural. The rise of religious politics is not without precedent, but rather returns us to the pre-New Deal norm. Religious political divisions are so common because religious groups provide politicians the opportunity to send targeted messages that excite their base.
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3.
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The Economic Approach to Social Capital
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics David I. Laibson Harvard University - Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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12 Jun 00
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26 Nov 03
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1,166 ( 3,805) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics David I. Laibson Harvard University - Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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15 Mar 01
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26 Nov 03
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To identify the determinants of social capital formation, it is necessary to understand the social capital investment decision of individuals. Individual social capital should then be aggregated to measure the social capital of a community. This paper assembles the evidence that supports the individual-based model of social capital formation, including seven facts: (l) the relationship between social capital and age is first increasing and then decreasing, (2) social capital declines with expected mobility, (3) social capital investment is higher in occupations with greater returns to social skills, (4) social capital is higher among homeowners, (5) social connections fall sharply with physical distance, (6) people who invest in human capital also invest in social capital, and (7) social capital appears to have interpersonal complementarities.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics David I. Laibson Harvard University - Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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12 Jun 00
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10 Apr 01
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To identify the determinants of social capital formation, it is necessary to understand the social capital investment decision of individuals. Individual social capital should then be aggregated to measure the social capital of a community. This paper assembles the evidence that supports the individual-based model of social capital formation, including seven facts: (1) the relationship between social capital and age is first increasing and then decreasing, (2) social capital declines with expected mobility, (3) social capital investment is higher in occupations with greater returns to social skills, (4) social capital is higher among homeowners, (5) social connections fall sharply with physical distance, (6) people who invest in human capital also invest in social capital, and (7) social capital appears to have interpersonal complementarities.
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4.
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Alberto F. Alesina Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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08 Nov 01
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26 Nov 03
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1,011 (4,832)
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European countries are much more generous to the poor relative to the US level of generosity. Economic models suggest that redistribution is a function of the variance and skewness of the pre-tax income distribution, the volatility of income (perhaps because of trade shocks), the social costs of taxation and the expected income mobility of the median voter. None of these factors appear to explain the differences between the US and Europe. Instead, the differences appear to be the result of racial heterogeneity in the US and American political institutions. Racial animosity in the US makes redistribution to the poor, who are disproportionately black, unappealing to many voters. American political institutions limited the growth of a socialist party, and more generally limited the political power of the poor.
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5.
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Why Have Housing Prices Gone Up?
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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01 Feb 05
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11 Mar 05
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964 ( 5,247) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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11 Mar 05
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11 Mar 05
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Since 1950, housing prices have risen regularly by almost two percent per year. Between 1950 and 1970, this increase reflects rising housing quality and construction costs. Since 1970, this increase reflects the increasing difficulty of obtaining regulatory approval for building new homes. In this paper, we present a simple model of regulatory approval that suggests a number of explanations for this change including changing judicial tastes, decreasing ability to bribe regulators, rising incomes and greater tastes for amenities, and improvements in the ability of homeowners to organize and influence local decisions. Our preliminary evidence suggests that there was a significant increase in the ability of local residents to block new projects and a change of cities from urban growth machines to homeowners' cooperatives.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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01 Feb 05
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11 Mar 05
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877
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Since 1950, housing prices have risen regularly by almost two percent per year. Between 1950 and 1970, this increase reflects rising housing quality and construction costs. Since 1970, this increase reflects the increasing difficulty of obtaining regulatory approval for building new homes. In this paper, we present a simple model of regulatory approval that suggests a number of explanations for this change including changing judicial tastes, decreasing ability to bribe regulators, rising incomes and greater tastes for amenities, and improvements in the ability of homeowners to organize and influence local decisions. Our preliminary evidence suggests that there was a significant increase in the ability of local residents to block new projects and a change of cities from urban growth machines to homeowners' cooperatives.
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Alberto F. Alesina Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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19 Apr 05
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17 Aug 05
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954 (5,327)
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Americans average 25.1 working hours per person in working age per week, but the Germans average 18.6 hours. The average American works 46.2 weeks per year, while the French average 40 weeks per year. Why do western Europeans work so much less than Americans? Recent work argues that these differences result from higher European tax rates, but the vast empirical labor supply literature suggests that tax rates can explain only a small amount of the differences in hours between the U.S. and Europe. Another popular view is that these differences are explained by long-standing European "culture", but Europeans worked more than Americans as late as the 1960s. In this paper, we argue that European labor market regulations, advocated by unions in declining European industries who argued "work less, work all" explain the bulk of the difference between the U.S. and Europe. These policies do not seem to have increased employment, but they may have had a more society-wide influence on leisure patterns because of a social multiplier where the returns to leisure increase as more people are taking longer vacations.
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7.
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Do Institutions Cause Growth?
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Rafael La Porta Tuck School of Business at Dartmouth Florencio Lopez de Silanes EDHEC Business School Andrei Shleifer Harvard University - Department of Economics
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16 Jun 04
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10 Oct 04
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903 ( 5,890) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Rafael La Porta Tuck School of Business at Dartmouth Florencio Lopez de Silanes EDHEC Business School Andrei Shleifer Harvard University - Department of Economics
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04 Jul 04
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14 Aug 04
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We revisit the debate over whether political institutions cause economic growth, or whether, alternatively, growth and human capital accumulation lead to institutional improvement. We find that most indicators of institutional quality used to establish the proposition that institutions cause growth are constructed to be conceptually unsuitable for that purpose. We also find that some of the instrumental variable techniques used in the literature are flawed. Basic OLS results, as well as a variety of additional evidence, suggest that a) human capital is a more basic source of growth than are the institutions, b) poor countries get out of poverty through good policies, often pursued by dictators, and c) subsequently improve their political institutions.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Rafael La Porta Tuck School of Business at Dartmouth Florencio Lopez de Silanes EDHEC Business School Andrei Shleifer Harvard University - Department of Economics
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16 Jun 04
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10 Oct 04
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793
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Abstract:
We revisit the debate over whether political institutions cause economic growth, or whether, alternatively, growth and human capital accumulation lead to institutional improvement. We find that most indicators of institutional quality used to establish the proposition that institutions cause growth are constructed to be conceptually unsuitable for that purpose. We also find that some of the instrumental variable techniques used in the literature are flawed. Basic OLS results, as well as a variety of additional evidence, suggest that a) human capital is a more basic source of growth than are the institutions, b) poor countries get out of poverty through good policies, often pursued by dictators, and c) subsequently improve their political institutions.
Institutions, growth, human capital
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8.
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Sprawl and Urban Growth
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA)
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13 May 03
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01 Jun 03
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884 ( 6,093) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA)
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01 Jun 03
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01 Jun 03
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Cities can be thought of as the absence of physical space between people and firms. As such, they exist to eliminate transportation costs for goods, people and ideas and transportation technologies dictate urban form. In the 21st century, the dominant form of city living is based on the automobile and this form is sometimes called sprawl. In this essay, we document that sprawl is ubiquitous and that it is continuing to expand. Using a variety of evidence, we argue that sprawl is not the result of explicit government policies or bad urban planning, but rather the inexorable product of car-based living. Sprawl has been associated with significant improvements in quality of living, and the environmental impacts of sprawl have been offset by technological change. Finally, we suggest that the primary social problem associated with sprawl is the fact that some people are left behind because they do not earn enough to afford the cars that this form of living requires.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA)
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13 May 03
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01 Jun 03
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801
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Cities can be thought of as the absence of physical space between people and firms. As such, they exist to eliminate transportation costs for goods, people and ideas and transportation technologies dictate urban form. In the 21st century, the dominant form of city living is based on the automobile and this form is sometimes called sprawl. In this essay, we document that sprawl is ubiquitous and that it is continuing to expand. Using a variety of evidence, we argue that sprawl is not the result of explicit government policies or bad urban planning, but rather the inexorable product of car-based living. Sprawl has been associated with significant improvements in quality of living, and the environmental impacts of sprawl have been offset by technological change. Finally, we suggest that the primary social problem associated with sprawl is the fact that some people are left behind because they do not earn enough to afford the cars that this form of living requires.
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Psychology and the Market
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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10 Dec 03
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23 Aug 07
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878 ( 6,161) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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04 Jan 04
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12 Jan 04
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56
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Prospect theory, loss aversion, mental accounts, hyperbolic discounting, cues, and the endowment effect can all be seen as examples of situationalism - the view that people isolate decisions and overweight immediate aspects of the situation relative to longer term concerns. But outside of the laboratory, emotionally-powerful situational factors - frames, social influence, mental accounts - are almost always endogenous and often the result of self-interested entrepreneurs. As such, laboratory work and, indeed, psychology more generally, gives us little guidance as to market outcomes. Economics provides a stronger basis for understanding the supply of emotionally-relevant situational variables. Paradoxically situationalism actually increases the relative importance of economics.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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10 Dec 03
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23 Aug 07
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Prospect theory, loss aversion, mental accounts, hyperbolic discounting, cues, and the endowment effect can all be seen as examples of situationalism - the view that people isolate decisions and overweight immediate aspects of the situation relative to longer term concerns. But outside of the laboratory, emotionally-powerful situational factors - frames, social influence, mental accounts - are almost always endogenous and often the result of self-interested entrepreneurs. As such, laboratory work and, indeed, psychology more generally, gives us little guidance as to market outcomes. Economics provides a stronger basis for understanding the supply of emotionally-relevant situational variables. Paradoxically, the rise of situationalism actually increases the relative importance of economics.
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10.
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The Rise of the Regulatory State
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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13 Nov 01
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26 Nov 03
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807 ( 7,039) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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14 Dec 01
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19 Jun 03
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During the Progressive Era at the beginning of the 20th century, the United States replaced litigation by regulation as the principal mechanism of social control of business. To explain why this happened, we present a model of choice of law enforcement strategy between litigation and regulation based on the idea that justice can be subverted with sufficient expenditure of resources. The model suggests that courts are more vulnerable to subversion than regulators, especially in an environment of significant inequality of wealth and political power. The switch to regulation can then be seen as an efficient response to the subversion of justice by robber barons during the Gilded Age. The model makes sense of the progressive reform agenda, and of the successes and failures of alternative law enforcement strategies in different countries.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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13 Nov 01
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26 Nov 03
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During the Progressive Era at the beginning of the 20th century, the United States replaced litigation by regulation as the principal mechanism of social control of business. To explain why this happened, we present a model of choice of law enforcement strategy between litigation and regulation based on the idea that justice can be subverted with sufficient expenditure of resources. The model suggests that courts are more vulnerable to subversion than regulators, especially in an environment of significant inequality of wealth and political power. The switch to regulation can then be seen as an efficient response to the subversion of justice by robber barons during the Gilded Age. The model makes sense of the progressive reform agenda, and of the successes and failures of alternative law enforcement strategies in different countries.
Law and Economics
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Legal Origins
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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30 Apr 01
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26 Nov 03
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784 ( 7,350) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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05 May 01
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10 Jun 01
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A central requirement in the design of a legal system is the protection of law enforcers from coercion by litigants through either violence or bribes. The higher the risk of coercion, the greater the need for protection and control of law enforcers by the state. This perspective explains why, in the 12 th and 13 th centuries, the relatively more peaceful England developed trials by jury, while the less peaceful France relied on state-employed judges for both collecting evidence and making decisions. Despite considerable legal evolution, these initial design choices have persisted for centuries (largely because France remained less peaceful than England), and may explain many differences between common and civil law traditions with respect to both the structure of legal systems and the observed social and economic outcomes.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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30 Apr 01
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26 Nov 03
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A central requirement in the design of a legal system is the protection of law enforcers from coercion by litigants through either violence or bribes. The higher the risk of coercion, the greater the need for protection and control of law enforcers by the state. This perspective explains why, in the 12th and 13th centuries, the relatively more peaceful England developed trials by jury, while the less peaceful France relied on state-employed judges for both collecting evidence and making decisions. Despite considerable legal evolution, these initial design choices have persisted for centuries (largely because France remained less peaceful than England), and may explain many differences between common and civil law traditions with respect to both the structure of legal systems and the observed social and economic outcomes.
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Why Have Americans Become More Obese?
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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16 Jan 03
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22 Apr 08
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742 ( 8,020) |
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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23 Jan 03
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22 Apr 08
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546
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Americans have become considerably more obese over the past 25 years. This increase is primarily the result of consuming more calories. The increase in food consumption is itself the result of technological innovations which made it possible for food to be mass prepared far from the point of consumption, and consumed with lower time costs of preparation and cleaning. Price changes are normally beneficial, but may not be if people have self-control problems. This applies to some, but not most, of the population.
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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16 Jan 03
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16 Jan 03
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Abstract:
Americans have become considerably more obese over the past 25 years. This increase is primarily the result of consuming more calories. The increase in food consumption is itself the result of technological innovations which made it possible for food to be mass prepared far from the point of consumption, and consumed with lower time costs of preparation and cleaning. Price changes are normally beneficial, but may not be if people have self-control problems. This applies to some population.
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13.
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The Governance of Not-for-Profit Firms
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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03 May 02
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Last Revised:
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26 Nov 03
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724 ( 8,327) |
11
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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21 May 02
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26 Nov 03
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620
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11
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Many factors including incentive-pay, powerful shareholders, and takeover threats push for-profits managers towards maximizing shareholder value. One of the most striking factors about non-profit firms is that they have no comparable governance institutions, and the only check on managers are boards that are themselves rarely responsible to anyone outside the firm. This essay discusses the implications of these weak governance institutions on non-profit behavior. A primary implication is that non-profits will often evolve into organizations that resemble workers' cooperatives. The primary check on this tendency is the need of the organizations to compete in outside markets. After presenting a model of non-profit behavior, I look at four different sectors (hospitals, museums, universities and the church). All display significant signs of capture by elite workers, but all still perform their basic missions reasonably, probably because of market competition.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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03 May 02
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27 May 02
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104
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10
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Abstract:
Many factors including incentive-pay, powerful shareholders, and takeover threats push for-profits managers towards maximizing shareholder value. One of the most striking factors about non-profit firms is that they have no comparable governance institutions, and the only check on managers are boards that are themselves rarely responsible to anyone outside the firm. This essay discusses the implications of these weak governance institutions on non-profit behavior. A primary implication is that non-profits will often evolve into organizations that resemble workers' cooperatives. The primary check on this tendency is the need of the organizations to compete in outside markets. After presenting a model of non-profit behavior, I look at four different sectors (hospitals, museums, universities and the church). All display significant signs of capture by elite workers, but all still perform their basic missions reasonably, probably because of market competition.
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14.
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Entrepreneurship and the City
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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17 Jul 07
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Last Revised:
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17 Jan 08
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690 ( 8,958) |
2
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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31 Oct 07
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17 Jan 08
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32
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Why do levels of entrepreneurship differ across America's cities? This paper presents basic facts on two measures of entrepreneurship: the self-employment rate and the number of small firms. Both of these measures are correlated with urban success, suggesting that more entrepreneurial cities are more successful. There is considerable variation in the self-employment rate across metropolitan areas, but about one-half of this heterogeneity can be explained by demographic and industrial variation. Self-employment is particularly associated with abundant, older citizens and with the presence of input suppliers. Conversely, small firm size and employment growth due to unaffiliated new establishments is associated most strongly with the presence of input suppliers and an appropriate labor force. I also find support for the Chinitz (1961) hypothesis that entrepreneurship is linked to a large number of small firms in supplying industries. Finally, there is a strong connection between area-level education and entrepreneurship.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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17 Jul 07
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Last Revised:
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28 Nov 07
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658
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2
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Abstract:
Why do levels of entrepreneurship differ across America's cities? This paper presents basic facts on two measures of entrepreneurship: the self-employment rate and the number of small firms. Both of these measures are correlated with urban success, suggesting that more entrepreneurial cities are more successful. There is considerable variation in the self-employment rate across metropolitan areas, but about one-half of this heterogeneity can be explained by demographic and industrial variation. Self-employment is particularly associated with abundant, older citizens and with the presence of input suppliers. Conversely, small firm size and employment growth due to unaffiliated new establishments is associated most strongly with the presence of input suppliers and an appropriate labor force. I also find support for the Chinitz (1961) hypothesis that entrepreneurship is linked to a large number of small firms in supplying industries. Finally, there is a strong connection between area-level education and entrepreneurship.
entrepreneurship, cities, self-employment, small firms, education
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15.
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Inequality
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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19 Jul 05
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Last Revised:
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24 Jul 09
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652 ( 9,708) |
45
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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09 Mar 06
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09 Mar 06
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228
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45
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This paper reviews five striking facts about inequality across countries. As Kuznets (1955) famously first documented, inequality first rises and then falls with income. More unequal societies are much less likely to have democracies or governments that respect property rights. Unequal societies have less redistribution, and we have little idea whether this relationship is caused by redistribution reducing inequality or inequality reducing redistribution. Inequality and ethnic heterogeneity are highly correlated, either because of differences in educational heritages across ethnicities or because ethnic heterogeneity reduces redistribution. Finally, there is much more inequality and less redistribution in the U.S. than in most other developed nations.
Economics - Economic and Econometric Theory, Housing, Urban Development and Transportation, Public Management, Welfare / Health Care/ Social Policy
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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13 Sep 05
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24 Jul 09
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37
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45
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Abstract:
This paper reviews five striking facts about inequality across countries. As Kuznets (1955) famouslyfirst documented, inequality first rises and then falls with income. More unequal societies are muchless likely to have democracies or governments that respect property rights. Unequal societies haveless redistribution, and we have little idea whether this relationship is caused by redistributionreducing inequality or inequality reducing redistribution. Inequality and ethnic heterogeneity arehighly correlated, either because of differences in educational heritages across ethnicities or becauseethnic heterogeneity reduces redistribution. Finally, there is much more inequality and lessredistribution in the U.S. than in most other developed nations.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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19 Jul 05
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Last Revised:
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19 Jul 05
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387
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45
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Abstract:
This paper reviews five striking facts about inequality across countries. As Kuznets (1955) famously first documented, inequality first rises and then falls with income. More unequal societies are much less likely to have democracies or governments that respect property rights. Unequal societies have less redistribution, and we have little idea whether this relationship is caused by redistribution reducing inequality or inequality reducing redistribution. Inequality and ethnic heterogeneity are highly correlated, either because of differences in educational heritages across ethnicities or because ethnic heterogeneity reduces redistribution. Finally, there is much more inequality and less redistribution in the U.S. than in most other developed nations.
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16.
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Researcher Incentives and Empirical Methods
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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03 Oct 06
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Last Revised:
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09 Jul 07
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554 ( 12,330) |
2
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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20 Oct 06
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09 Jul 07
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17
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Economists are quick to assume opportunistic behavior in almost every walk of life other than our own. Our empirical methods are based on assumptions of human behavior that would not pass muster in any of our models. The solution to this problem is not to expect a mass renunciation of data mining, selective data cleaning or opportunistic methodology selection, but rather to follow Leamer's lead in designing and using techniques that anticipate the behavior of optimizing researchers. In this essay, I make ten points about a more economic approach to empirical methods and suggest paths for methodological progress.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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03 Oct 06
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03 Oct 06
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537
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2
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Abstract:
Economists are quick to assume opportunistic behavior in almost every walk of life other than our own. Our empirical methods are based on assumptions of human behavior that would not pass muster in any of our models. The solution to this problem is not to expect a mass renunciation of data mining, selective data cleaning or opportunistic methodology selection, but rather to follow Leamer's lead in designing and using techniques that anticipate the behavior of optimizing researchers. In this essay, I make ten points about a more economic approach to empirical methods and suggest paths for methodological progress.
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17.
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The Impact of Zoning on Housing Affordability
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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Posted:
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28 Feb 02
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26 Nov 03
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510 ( 13,866) |
34
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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08 Mar 02
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30 Sep 02
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133
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34
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Does America face an affordable housing crisis and, if so, why? This paper argues that in much of America the price of housing is quite close to the marginal, physical costs of new construction. The price of housing is significantly higher than construction costs only in a limited number of areas, such as California and some eastern cities. In those areas, we argue that high prices have little to do with conventional models with a free market for land. Instead, our evidence suggests that zoning and other land use controls, play the dominant role in making housing expensive.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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| Posted: |
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28 Feb 02
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Last Revised:
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26 Nov 03
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377
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34
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Abstract:
Does America face an affordable housing crisis and, if so, why? This paper argues that in much of America the price of housing is quite close to the marginal, physical costs of new construction. The price of housing is significantly higher than construction costs only in a limited number of areas, such as California and some eastern cities. In those areas, we argue that high prices have little to do with conventional models with a free market for land. Instead, our evidence suggests that zoning and other land use controls play the dominant role in making housing expensive.
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18.
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The Injustice of Inequality
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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Posted:
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15 Sep 02
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Last Revised:
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26 Nov 03
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506 ( 14,016) |
58
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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15 Sep 02
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15 Sep 02
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20
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58
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Abstract:
In many countries, the operation of legal, political and regulatory institutions is subverted by the wealthy and the politically powerful for their own benefit. This subversion takes the form of corruption, intimidation, and other forms of influence. We present a model of such institutional subversion focusing specifically on courts and of the effects of inequality in economic and political resources on the magnitude of subversion. We then use the model to analyze the consequences of institutional subversion for the law and order environment in the country, as well as for capital accumulation and growth. We illustrate the model with historical evidence from Gilded Age United States and the transition economies of the 1990s. We also present some cross-country evidence consistent with the basic prediction of the model.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jose A. Scheinkman Princeton University - Department of Economics Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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15 Sep 02
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Last Revised:
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26 Nov 03
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486
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58
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Abstract:
In many countries, the operation of legal, political and regulatory institutions is subverted by the wealthy and the politically powerful for their own benefit. This subversion takes the form of corruption, intimidation, and other forms of influence. We present a model of such institutional subversion - focusing specifically on courts - and of the effects of inequality in economic and political resources on the magnitude of subversion. We then use the model to analyze the consequences of institutional subversion for the law and order environment in the country, as well as for capital accumulation and growth. We illustrate the model with historical evidence from Gilded Age United States and the transition economies of the 1990s. We also present some cross-country evidence consistent with the basic prediction of the model.
Inequality, growth, subversion of institutions
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19.
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Cities, Regions and the Decline of Transport Costs
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Janet E. E. Kohlhase University of Houston - Department of Economics
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Posted:
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05 Aug 03
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Last Revised:
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24 Sep 09
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491 ( 14,612) |
32
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Janet E. E. Kohlhase University of Houston - Department of Economics
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| Posted: |
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05 Aug 03
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Last Revised:
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07 Aug 03
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452
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32
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Abstract:
The theoretical framework of urban and regional economics is built on transportation costs for manufactured goods. But over the twentieth century, the costs of moving these goods have declined by over 90% in real terms, and there is little reason to doubt that this decline will continue. Moreover, technological change has eliminated the importance of fixed infrastructure transport (rail and water) that played a critical role in creating natural urban centres. In this article, we document this decline and explore several simple implications of a world where it is essentially free to move goods, but expensive to move people. We find empirical support for these implications.
Transport Costs, Congestion, Spatial Distribution of Economic Activity, Concentration and Decentralisation, Productivity, Growth of Cities and Regions, Density
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Janet E. E. Kohlhase University of Houston - Department of Economics
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| Posted: |
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05 Aug 03
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Last Revised:
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24 Sep 09
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39
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32
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Abstract:
The theoretical framework of urban and regional economics is built on transportation costs for manufactured goods. But over the twentieth century, the costs of moving these goods have declined by over 90% in real terms, and there is little reason to doubt that this decline will continue. Moreover, technological change has eliminated the importance of fixed infrastructure transport (rail and water) that played a critical role in creating natural urban centres. In this article, we document this decline and explore several simple implications of a world where it is essentially free to move goods, but expensive to move people. We find empirical support for these implications.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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20.
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Explaining the Rise in Youth Suicide
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Karen Norberg Boston University - Department of Psychiatry
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Posted:
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12 Jun 00
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Last Revised:
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26 Nov 03
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447 ( 16,598) |
16
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Karen Norberg Boston University - Department of Psychiatry
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| Posted: |
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15 Mar 01
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26 Nov 03
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405
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16
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Suicide rates among youths aged 15-24 have tripled in the past half-century, even as rates for adults and the elderly have declined. And for every youth suicide completion, there are nearly 400 suicide attempts. This paper examines the dynamics of youth suicide attempts and completions, and reaches three conclusions. First, we suggest that many suicide attempts by youths can be viewed as a strategic action on the part of the youth to resolve conflicts within oneself or with others. Youths have little direct economic or familial power, and in such a situation, self-injury can be used to signal distress or to encourage a response by others. Second, we present evidence for contagion effects. Youths who have a friend or family member who attempts or commits suicide are more likely to attempt or commit suicide themselves. Finally, we show that to the extent we can explain the rise in youth suicide over time, the most important explanatory variable is the increased share of youths living in homes with a divorced parent. The divorce rate is more important for suicides than either the share of children living with step-parents or the share of female-headed households.
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Karen Norberg Boston University - Department of Psychiatry
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| Posted: |
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12 Jun 00
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10 Apr 01
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42
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16
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Abstract:
Suicide rates among youths aged 15-24 have tripled in the past half-century, even as rates for adults and the elderly have declined. And for every youth suicide completion, there are nearly 400 suicide attempts. This paper examines the dynamics of youth suicide attempts and completions, and reaches three conclusions. First, we suggest that many suicide attempts by youths can be viewed as a strategic action on the part of the youth to resolve conflicts within oneself or with others. Youths have little direct economic or familial power, and in such a situation, self-injury can be used to signal distress or to encourage a response by others. Second, we present evidence for contagion effects. Youths who have a friend or family member who attempts or commits suicide are more likely to attempt or commit suicide themselves. Finally, we show that to the extent we can explain the rise in youth suicide over time, the most important explanatory variable is the increased share of youths living in homes with a divorced parent. The divorce rate is more important for suicides than either the share of children living with step-parents or the share of female-headed households.
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21.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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03 Jan 08
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Last Revised:
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13 Feb 08
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425 (17,746)
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1
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Abstract:
The economic approach to cities relies on a spatial equilibrium for workers, employers and builders. The worker's equilibrium implies that positive attributes in one location, like access to downtown or high wages, are offset by negative attributes, like high housing prices. The employer's equilibrium requires that high wages be offset by a high level of productivity, perhaps due to easy access to customers or suppliers. The search for the sources of productivity differences that can justify high wages is the basis for the study of agglomeration economies which has been a significant branch of urban economics in the past 20 years. The builder's equilibrium condition pushes us to understand the causes of supply differences across space that can explain why some places have abundant construction and low prices while others have little construction and high prices. Since the economic theory of cities emphasizes a search for exogenous causes of endogenous outcomes like local wages, housing prices and city growth, it is unsurprising that the economic empirics on cities have increasingly focused on the quest for exogenous sources of variation. The economic approach to urban policy emphasizes the need to focus on people, rather than places, as the ultimate objects of policy concern and the need for policy to anticipate the mobility of people and firms.
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22.
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Corruption in America
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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Posted:
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04 Oct 04
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Last Revised:
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11 Nov 04
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409 ( 18,665) |
36
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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| Posted: |
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19 Oct 04
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Last Revised:
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19 Oct 04
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51
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36
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Abstract:
We use a data set of federal corruption convictions in the U.S. to investigate the causes and consequences of corruption. More educated states, and to a less degree richer states, have less corruption. This relationship holds even when we use historical factors like education in 1928 or Congregationalism in 1890, as instruments for the level of schooling today. The level of corruption is weakly correlated with the level of income inequality and racial fractionalization, and uncorrelated with the size of government. There is a weak negative relationship between corruption and employment and income growth. These results echo the cross-country findings, and support the view that the correlation between development and good political outcomes occurs because more education improves political institutions.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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| Posted: |
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04 Oct 04
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Last Revised:
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11 Nov 04
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358
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36
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Abstract:
We use a data set of federal corruption convictions in the U.S. to investigate the causes and consequences of corruption. More educated states, and to a less degree richer states, have less corruption. This relationship holds even when we use historical factors like education in 1928 or Congregationalism in 1890, as instruments for the level of schooling today. The level of corruption is weakly correlated with the level of income inequality and racial fractionalization, and uncorrelated with the size of government. There is a weak negative relationship between corruption and employment and income growth. These results echo the cross-country findings, and support the view that the correlation between development and good political outcomes occurs because more education improves political institutions.
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23.
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Cities and Warfare: The Impact of Terrorism on Urban Form
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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Posted:
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14 Dec 01
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Last Revised:
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22 Apr 08
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407 ( 18,791) |
12
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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| Posted: |
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20 Dec 01
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20 Dec 01
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19
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12
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Abstract:
What impact will terrorism have on America's cities? Historically, large-scale violence has impacted cities in three ways. First, concentrations of people have an advantage in defending themselves from attackers, making cities more appealing in times of violence. Second, cities often make attractive targets for violence, which creates an incentive for people to disperse. Finally, since warfare and terrorism often specifically target means of transportation, violence can increase the effective cost of transportation, which will usually increase the demand for density. Evidence on war and cities in the 20th century suggests that the effect of wars on urban form can be large (for example, Berlin in World War II), but more commonly neither terrorism nor wars have significantly altered urban form. As such, across America the effect of terrorism on cities is likely to be small. The only exception to this is downtown New York which, absent large-scale subsidies, will probably not be fully rebuilt. Furthermore, such subsidies make little sense to us.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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| Posted: |
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14 Dec 01
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Last Revised:
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22 Apr 08
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388
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12
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Abstract:
What impact will terrorism have on America's cities? Historically, large-scale violence has impacted cities in three ways. First, concentrations of people have an advantage in defending themselves from attackers, making cities more appealing in times of violence. Second, cities often make attractive targets for violence, which creates an incentive for people to disperse. Finally, since warfare and terrorism often specifically target means of transportation, violence can increase the effective cost of transportation, which will usually increase the demand for density. Evidence on war and cities in the 20th century suggests that the effect of wars on urban form can be large (for example, Berlin in World War II), but more commonly neither terrorism nor wars have significantly altered urban form. As such, across America the effect of terrorism on cities is likely to be small. The only exception to this is downtown New York which, absent large-scale subsidies, will probably not be fully rebuilt. Furthermore, such subsidies make little sense to us.
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24.
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A Case for Quantity Regulation
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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Posted:
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23 Jan 01
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Last Revised:
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26 Nov 03
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407 ( 18,791) |
7
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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24 Mar 01
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05 Oct 01
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22
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7
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Abstract:
Contrary to the standard economic advice, many regulations of financial intermediaries, as well as other regulations such as blue laws, fishing rules, zoning restrictions, or pollution controls, take the form of quantity controls rather than taxes. We argue that costs of enforcement are crucial to understanding these choices. When violations of quantity regulations are cheaper to discover than failures to pay taxes, the former can emerge as the optimal instrument for the government, even when it is less attractive in the absence of enforcement costs. This analysis is especially relevant to situations where private enforcement of regulations is crucial.
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Andrei Shleifer Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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23 Jan 01
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Last Revised:
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26 Nov 03
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385
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5
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Abstract:
Contrary to the standard economic advice, many regulations of financial intermediaries, as well as other regulations such as blue laws, fishing rules, zoning restrictions, or pollution controls, take the form of quantity controls rather than taxes. We argue that costs of enforcement are crucial to understanding these choices. When violations of quantity regulations are cheaper to discover than failures to pay taxes, the former can emerge as the optimal instrument for the government, even when it is less attractive in the absence of enforcement costs. This analysis is especially relevant to situations where private enforcement of regulations is crucial.
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25.
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Is There a New Urbanism? The Growth of U.S. Cities in the 1990s
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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Posted:
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20 Jun 01
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22 Apr 08
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405 ( 18,905) |
124
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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28 Jun 01
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21 Jan 02
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55
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The 1990s were an unusually good decade for the largest American cities and, in particular, for the cities of the Midwest. However, fundamentally urban growth in the 1990s looked extremely similar to urban growth during the prior post-war decades. The growth of cities was determined by three large trends: (1) cities with strong human capital bases grew faster than cities without skills, (2) people moved to warmer, drier places, and (3) cities built around the automobile replaced cities that rely on public transportation. In the 1990s (as in the 1980s), more local government spending was associated with slower growth, unless that spending was on highways. We shouldn't be surprised by the lack of change in patterns of urban growth, after all the correlation of city growth rates across decades is generally over 70 percent.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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| Posted: |
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20 Jun 01
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22 Apr 08
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350
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124
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Abstract:
The 1990s were an unusually good decade for the largest American cities and, in particular, for the cities of the Midwest. However, fundamentally urban growth in the 1990s looked extremely similar to urban growth during the prior post-war decades. The growth of cities was determined by three large trends: (1) cities with strong human capital bases grew faster than cities without skills, (2) people moved to warmer, drier places, and (3) cities built around the automobile replaced cities that rely on public transportation. In the 1990s (as in the 1980s), more local government spending was associated with slower growth, unless that spending was on highways. We shouldn't be surprised by the lack of change in patterns of urban growth, after all the correlation of city growth rates across decades is generally over 70 percent.
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26.
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Zoltan J. Acs George Mason University - School of Public Policy Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Robert E. Litan AEI-Brookings Joint Center for Regulatory Studies Lee Fleming Harvard University - Technology & Operations Management Unit Stephan J. Goetz Pennsylvania State University - The Northeastern Regional Center for Rural Development William R. Kerr Harvard University - Entrepreneurial Management Unit Steven Klepper Carnegie Mellon University - David A. Tepper School of Business Stuart S. Rosenthal Syracuse University - Department of Economics Olav Sorenson Rotman School, University of Toronto William C. Strange University of Toronto - Rotman School of Management
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28 Feb 08
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13 Oct 09
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403 (19,070)
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2
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Abstract:
Like all politics, all entrepreneurship is local. Individuals launch firms and, if successful, expand their enterprises to other locations. But new firms must start somewhere, even if their businesses are conducted largely or exclusively on the Internet. Likewise, policymakers at local and state levels increasingly recognize that entrepreneurship is the key to building and sustaining their economies' growth. Although this is a seemingly obvious proposition, it represents something of a departure from past thinking about how local, state, or regional economies grow. Historically, state and local policymakers have put their energies into trying to attract existing firms from somewhere else, either to relocate to a particular area or to build new facilities there. Such smokestack chasing - or, in this cleaner era, simply firm chasing - often has degenerated into what is essentially a zero-sum game for the national economy. When one city or state offers tax breaks or other financial inducements to encourage firms to locate new plants or headquarters, and succeeds, some other city or state loses out in the process. Local, state, and regional economic development centered on entrepreneurship, however, is a fundamentally different phenomenon. The formation and growth of new firms, especially those built around new products or ways of doing things, wherever this occurs, is clearly a positive sum game, not just for the locality, but for the nation as a whole. This essay provides a guide to policymakers and citizens to what is known about the effects of various local and state policies aimed at fostering entrepreneurially driven growth. There is also much we do not know; thus, the essay identifies subjects that require further research.
entrepreneurship, policy, urban, city, local, state, regional, roadmap, economy
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27.
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Why Do The Poor Live In Cities?
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA) Jordan M. Rappaport Federal Reserve Bank of Kansas City - Economic Research Department
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Posted:
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21 May 00
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26 Nov 03
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403 ( 19,010) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA) Jordan M. Rappaport Federal Reserve Bank of Kansas City - Economic Research Department
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| Posted: |
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09 Aug 00
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26 Nov 03
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367
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36
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Abstract:
More than 17 percent of households in American central cities live in poverty; in American suburbs, just 7.4 percent of households live in poverty. The income elasticity of demand for land is too low for urban poverty to be the result of wealthy individuals' wanting to live where land is cheap (the traditional urban economics explanation of urban poverty). Instead, the urbanization of poverty appears to be the result of better access to public transportation in central cities, and central city governments favoring the poor (relative to suburban governments).
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA) Jordan M. Rappaport Federal Reserve Bank of Kansas City - Economic Research Department
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| Posted: |
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21 May 00
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10 Apr 01
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36
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36
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Abstract:
More than 17 percent of households in American central cities live in poverty; in American suburbs, just 7.4 percent of households live in poverty. The income elasticity of demand for land is too low for urban poverty to be the result of wealthy individuals' wanting to live where land is cheap (the traditional urban economics explanation of urban poverty). Instead, the urbanization of poverty appears to be the result of better access to public transportation in central cities, and central city governments favoring the poor (relative to suburban governments).
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28.
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The Rise of the Skilled City
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Albert Saiz University of Pennsylvania - The Wharton School
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Posted:
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04 Jan 04
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12 Sep 09
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382 ( 20,329) |
46
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Albert Saiz University of Pennsylvania - The Wharton School
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| Posted: |
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30 Jul 04
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26 May 06
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306
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For more than a century, educated cities have grown more quickly than comparable cities with less human capital. This fact survives a battery of other control variables, metropolitan area fixed effects and tests for reverse causality. We also find that skilled cities are growing because they are becoming more economically productive (relative to less skilled cities), not because these cities are becoming more attractive places to live. Most surprisingly, we find evidence suggesting that the skills-city growth connection occurs mainly in declining areas and occurs in large part because skilled cities are better at adapting to economic shocks. As in Schultz (1964), skills appear to permit adaptation.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Albert Saiz University of Pennsylvania - The Wharton School
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| Posted: |
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04 Jan 04
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12 Sep 09
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76
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Abstract:
For more than a century, educated cities have grown more quickly than comparable cities with less human capital. This fact survives a battery of other control variables, metropolitan area fixed effects and tests for reverse causality. We also find that skilled cities are growing because they are becoming more economically productive (relative to less skilled cities), not because these cities are becoming more attractive places to live. Most surprisingly, we find evidence suggesting that the skills-city growth connection occurs mainly in declining areas and occurs in large part because skilled cities are better at adapting to economic shocks. As in Schultz (1964), skills appear to permit adaptation.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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29.
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Urban Growth and Housing Supply
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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Posted:
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05 Feb 05
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29 Feb 08
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368 ( 21,363) |
27
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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| Posted: |
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29 Feb 08
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29 Feb 08
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34
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Cities are physical structures, but the modern literature on urban economic development rarely acknowledges that fact. The elasticity of housing supply helps determine the extent to which increases in productivity will create bigger cities or just higher paid workers and more expensive homes. In this article, we present a simple model that provides a framework for doing empirical work that integrates the heterogeneity of housing supply into urban development. Empirical analysis yields results consistent with the implications of the model that differences in the nature of house supply across space are not only responsible for higher housing prices, but also affect how cities respond to increases in productivity.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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| Posted: |
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05 Feb 05
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Last Revised:
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05 Feb 05
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302
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27
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Abstract:
Cities are physical structures, but the modern literature on urban economic development rarely acknowledges that fact. The elasticity of housing supply helps determine the extent to which increases in productivity will create bigger cities or just higher paid workers and more expensive homes. In this paper, we present a simple model that provides a framework for doing empirical work that integrates the heterogeneity of housing supply into urban development. Empirical analysis yields results consistent with the implications of the model that differences in the nature of house supply across space are not only responsible for higher housing prices, but also affect how cities respond to increases in productivity.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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| Posted: |
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01 Mar 05
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Last Revised:
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01 Mar 05
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32
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27
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Abstract:
Cities are physical structures, but the modern literature on urban economic development rarely acknowledges that fact. The elasticity of housing supply helps determine the extent to which increases in productivity will create bigger cities or just higher paid workers and more expensive homes. In this paper, we present a simple model that provides a framework for doing empirical work that integrates the heterogeneity of housing supply into urban development. Empirical analysis yields results consistent with the implications of the model that differences in the nature of house supply across space are not only responsible for higher housing prices, but also affect how cities respond to increases in productivity.
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30.
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Urban Colossus: Why is New York America's Largest City?
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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01 Jun 05
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Last Revised:
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21 Mar 06
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366 ( 21,573) |
5
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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06 Jul 05
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06 Jul 05
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37
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New York has been remarkably successful relative to any other large city outside of the sunbelt and it remains the nation's premier metropolis. What accounts for New York's rise and continuing success? The rise of New York in the early nineteenth century is the result of technological changes that moved ocean shipping from a point-to-point system to a hub and spoke system; New York's geography made it the natural hub of this system. Manufacturing then centered in New York because the hub of a transport system is, in many cases, the ideal place to transform raw materials into finished goods. This initial dominance was entrenched by New York's role as the hub for immigration. In the late 20th century, New York's survival is based almost entirely on finance and business services, which are also legacies of the port. In this period, New York's role as a hub still matters, but it is far less important than the edge that density and agglomeration give to the acquisition of knowledge.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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01 Jun 05
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Last Revised:
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21 Mar 06
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329
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5
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Abstract:
New York has been remarkably successful relative to any other large city outside of the sunbelt and it remains the nation's premier metropolis. What accounts for New York's rise and continuing success? The rise of New York in the early nineteenth century is the result of technological changes that moved ocean shipping from a point-to-point system to a hub and spoke system; New York's geography made it the natural hub of this system. Manufacturing then centered in New York because the hub of a transport system is, in many cases, the ideal place to transform raw materials into finished goods. This initial dominance was entrenched by New York's role as the hub for immigration. In the late 20th century, New York's survival is based almost entirely on finance and business services, which are also legacies of the port. In this period, New York's role as a hub still matters, but it is far less important than the edge that density and agglomeration give to the acquisition of knowledge.
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31.
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Non-Market Interactions
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jose A. Scheinkman Princeton University - Department of Economics
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Posted:
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16 Dec 00
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26 Nov 03
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366 ( 21,509) |
45
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jose A. Scheinkman Princeton University - Department of Economics
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15 Mar 01
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26 Nov 03
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320
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45
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A large body of recent research argues that social, or non-market, interactions can explain a wide range of puzzling phenomena from fashion cycles to stock market crashes. This paper attempts to connect the range of these papers with a general model and a broad empirical overview. We establish conditions for existence and uniqueness of equilibria in social interactions models. The existence of multiple equilibria requires sufficient non-linearity in social interactions and only moderate heterogeneity across agents--strategic complementarities are neither necessary nor sufficient for multiple equilibria. We establish conditions for the existence of a social multiplier, which is the ratio of the aggregate outcome-input relationship to the individual outcome-input relationship. Models with multiple equilibria are empirically indistinguishable from models with significant social multipliers. Finally, we show the formal relationship between three known methods of empirically estimating social interactions, and suggests the plusses and minuses of these three approaches.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jose A. Scheinkman Princeton University - Department of Economics
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| Posted: |
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16 Dec 00
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Last Revised:
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05 Oct 01
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46
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45
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Abstract:
A large body of recent research argues that social, or non-market, interactions can explain a wide range of puzzling phenomena from fashion cycles to stock market crashes. This paper attempts to connect the range of these papers with a general model and a broad empirical overview. We establish conditions for existence and uniqueness of equilibria in social interactions models. The existence of multiple equilibria requires sufficient non-linearity in social interactions and only moderate heterogeneity across agents strategic complementarities are neither necesssary nor sufficient for multiple equilibria. We establish conditions for the existence of a social multiplier, which is the ratio of the aggregate outcome-input relationship to the individual outcome-input relationship. Models with multiple equilibria are empirically indistinguishable from models with significant social multipliers. Finally, we show the formal relationship between three known methods of empirically estimating social interactions, and suggests the plusses and minuses of these three approaches.
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32.
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Paternalism and Psychology
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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29 Nov 05
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Last Revised:
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31 Jul 09
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360 ( 21,928) |
13
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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20 Jul 06
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20 Jul 06
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133
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An increasingly large body of evidence on bounded rationality has led many scholars to question economics' traditional hostility towards paternalism. But if individuals' ability to make rational decisions is limited, wouldn't some paternal overseer's ability also be limited - both because the overseers would be individuals and because they would be appointed by individuals? That flaw plagues both "hard" and "soft" paternalism; that is, paternalism that either mandates compliance or that allows individual "choice" at some cost.
edward l. glaeser, economics, paternalism, economic paternalism, hard paternalism, soft paternalism, psychology, supply of error, manipulation, tax bans, public monitoring
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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29 Nov 05
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25 Apr 06
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191
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13
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Abstract:
Does bounded rationality make paternalism more attractive? This Essay argues that errors will be larger when suppliers have stronger incentives or lower costs of persuasion and when consumers have weaker incentives to learn the truth. These comparative statics suggest that bounded rationality will often increase the costs of government decisionmaking relative to private decisionmaking, because consumers have better incentives to overcome errors than government decisionmakers, consumers have stronger incentives to choose well when they are purchasing than when they are voting and it is more costly to change the beliefs of millions of consumers than a handful of bureaucrats. As such, recognizing the limits of human cognition may strengthen the case for limited government.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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24 Feb 06
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Last Revised:
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31 Jul 09
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36
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13
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Abstract:
Does bounded rationality make paternalism more attractive? This Essay argues that errors will be larger when suppliers have stronger incentives or lower costs of persuasion and when consumers have weaker incentives to learn the truth. These comparative statics suggest that bounded rationality will often increase the costs of government decisionmaking relative to private decisionmaking, because consumers have better incentives to overcome errors than government decisionmakers, consumers have stronger incentives to choose well when they are purchasing than when they are voting and it is more costly to change the beliefs of millions of consumers than a handful of bureaucrats. As such, recognizing the limits of human cognition may strengthen the case for limited government.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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33.
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Glenn David Ellison Massachusetts Institute of Technology (MIT) - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics William R. Kerr Harvard University - Entrepreneurial Management Unit
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| Posted: |
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17 Apr 07
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Last Revised:
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02 Jun 09
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346 (23,023)
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23
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Abstract:
Many industries are geographically concentrated. Many mechanisms that could account for such agglomeration have been proposed. We note that these theories make different predictions about which pairs of industries should be coagglomerated. We discuss the measurement of coagglomeration and use data from the Census Bureau's Longitudinal Research Database from 1972 to 1997 to compute pairwise coagglomeration measurements for U.S. manufacturing industries. Industry attributes are used to construct measures of the relevance of each of Marshall's three theories of industry agglomeration to each industry pair: (1) agglomeration saves transport costs by proximity to input suppliers or final consumers, (2) agglomeration allows for labor market pooling, and (3) agglomeration facilitates intellectual spillovers. We assess the importance of the theories via regressions of coagglomeration indices on these measures. Data on characteristics of corresponding industries in the United Kingdom are used as instruments. We find evidence to support each mechanism. Our results suggest that input-output dependencies are the most important factor, followed by labor pooling.
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34.
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The Political Economy of Hatred
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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15 Sep 02
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Last Revised:
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26 Nov 03
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343 ( 23,270) |
44
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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19 Jan 03
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26 Nov 03
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313
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What determines the intensity and objects of hatred? Hatred forms when people believe that out-groups are responsible for past and future crimes, but the reality of past crimes has little to do with the level of hatred. Instead, hatred is the result of an equilibrium where politicians supply stories of past atrocities in order to discredit the opposition and consumers listen to them. The supply of hatred is a function of the degree to which minorities gain or lose from particular party platforms, and as such, groups that are particularly poor or rich are likely to be hated. Strong constitutions that limit the policy space and ban specific anti-minority policies will limit hate. The demand for hatred falls if consumers interact regularly with the hated group, unless their interactions are primarily abusive. The power of hatred is so strong that opponents of hatred motivate their supporters by hating the haters.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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15 Sep 02
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15 Sep 02
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30
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44
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Abstract:
What determines the intensity and objects of hatred? Hatred forms when people believe that out-groups are responsible for past and future crimes, but the reality of past crimes has little to do with the level of hatred. Instead, hatred is the result of an equilibrium where politicians supply stories of past atrocities in order to discredit the opposition and consumers listen to them. The supply of hatred is a function of the degree to which minorities gain or lose from particular party platforms, and as such, groups that are particularly poor or rich are likely to be hated. Strong constitutions that limit the policy space and ban specific anti-minority policies will limit hate. The demand for hatred falls if consumers interact regularly with the hated group, unless their interactions are primarily abusive. The power of hatred is so strong that opponents of hatred motivate their supporters by hating the haters.
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35.
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Why is Manhattan So Expensive? Regulation and the Rise in House Prices
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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Posted:
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18 Nov 03
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Last Revised:
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15 Sep 09
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336 ( 23,892) |
40
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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| Posted: |
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28 Nov 03
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15 Sep 09
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59
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Abstract:
In Manhattan and elsewhere, housing prices have soared over the 1990s. Rising incomes, lower interest rates, and other factors can explain the demand side of this increase, but some sluggishness on the supply of apartment buildings also is needed to account for the high and rising prices. In a market dominated by high rises, the marginal cost of supplying more space is reflected in the cost of adding an extra floor to any new building. Home building is a highly competitive industry with almost no natural barriers to entry, yet prices in Manhattan currently appear to be more than twice their supply costs. We argue that land use restrictions are the natural explanation of this gap. We also present evidence consistent with our hypothesis that regulation is constraining the supply of housing so that increased demand leads to much higher prices, not many more units, in a number of other high price housing markets across the country.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Raven E. Saks U.S. Federal Reserve - Division of Research and Statistics
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| Posted: |
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18 Nov 03
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Last Revised:
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28 Nov 03
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277
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40
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Abstract:
In Manhattan and elsewhere, housing prices have soared over the 1990s. Rising incomes, lower interest rates, and other factors can explain the demand side of this increase, but some sluggishness on the supply of apartment buildings also is needed to account for the high and rising prices. In a market dominated by high rises, the marginal cost of supplying more space is reflected in the cost of adding an extra floor to any new building. Home building is a highly competitive industry with almost no natural barriers to entry, yet prices in Manhattan currently appear to be more than twice their supply costs. We argue that land use restrictions are the natural explanation of this gap. We also present evidence consistent with our hypothesis that regulation is constraining the supply of housing so that increased demand leads to much higher prices, not many more units, in a number of other high price housing markets across the country.
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36.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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14 Mar 01
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26 Nov 03
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330 (24,393)
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33
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Abstract:
In the United States, religious attendance rises sharply with education across individuals, but religious attendance declines sharply with education across denominations. This puzzle is explained if education both increases the returns to social connection and reduces the extent of religious belief. The positive effect of education on sociability explains the positive education-religion relationship. The negative effect of education on religious belief causes more educated individuals to sort into less fervent religions, which explains the negative relationship between education and religion across denominations. Cross-country differences in the impact of education on religious belief can explain the large cross-country variation in the education-religion connection. These cross-country differences in the education-belief relationship can be explained by political factors (such as communism) which lead some countries to use state-controlled education to discredit religion.
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37.
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Consumer City
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jed Kolko Public Policy Institute of California Albert Saiz University of Pennsylvania - The Wharton School
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Posted:
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19 Jul 00
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26 Nov 03
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325 ( 24,852) |
72
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jed Kolko Public Policy Institute of California Albert Saiz University of Pennsylvania - The Wharton School
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09 Aug 00
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26 Nov 03
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242
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72
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Urban economics has traditionally viewed cities as having advantages in production and disadvantages in consumption. We argue that the role of urban density in facilitating consumption is extremely important and understudied. As firms become more mobile, the success of cities hinges more and more on cities' role as centers of consumption. Empirically, we find that high amenity cities have grown faster than low amenity cities. Urban rents have gone up faster than urban wages, suggesting that the demand for living in cities has risen for reasons beyond rising wages. The rise of reverse commuting suggest the same consumer city phenomena.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jed Kolko Public Policy Institute of California Albert Saiz University of Pennsylvania - The Wharton School
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19 Jul 00
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01 Apr 01
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83
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72
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Abstract:
Urban economics has traditionally viewed cities as having advantages in production and disadvantages in consumption. We argue that the role of urban density in facilitating consumption is extremely important and understudied. As firms become more mobile, the success of cities hinges more and more on cities' role as centers of consumption. Empirically, we find that high amenity cities have grown faster than low amenity cities. Urban rents have gone up faster than urban wages, suggesting that the demand for living in cities has risen for reasons beyond rising wages. The rise of reverse commuting suggest the same consumer city phenomena.
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38.
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The Benefits of the Home Mortgage Interest Deduction
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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Posted:
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19 Oct 02
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22 Apr 08
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314 ( 25,894) |
18
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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22 Oct 02
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22 Apr 08
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259
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The home mortgage interest deduction creates incentives to buy more housing and to become a homeowner, and the case for the deduction rests on social benefits from housing consumption and homeownership. There is little evidence suggesting large externalities from the level of housing consumption, but there appear to be externalities from homeownership. Externalities from living around homeowners are far too small to justify the deduction. Externalities from homeownership are larger, but the home mortgage interest deduction is a particularly poor instrument for encouraging homeownership since it is targeted at the wealthy, who are almost always homeowners. The irrelevance of the deduction is supported by the time series which shows that the ownership subsidy moves with inflation and has changed significantly between 1960 and today, but the homeownership rate has been essentially constant.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jesse M. Shapiro University of Chicago
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| Posted: |
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19 Oct 02
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19 Oct 02
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55
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18
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Abstract:
The home mortgage interest deduction creates incentives to buy more housing and to become a homeowner, and the case for the deduction rests on social benefits from housing consumption and homeownership. There is little evidence suggesting large externalities from the level of housing consumption, but there appear to be externalities from homeownership. Externalities from living around homeowners are far too small to justify the deduction. Externalities from homeownership are larger, but the home mortgage interest deduction is a particularly poor instrument for encouraging homeownership since it is targeted at the wealthy, who are almost always homeowners. The irrelevance of the deduction is supported by the time series which shows that the ownership subsidy moves with inflation and has changed significantly between 1960 and today, but the homeownership rate has been essentially constant.
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39.
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Extremism and Social Learning
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Cass R. Sunstein Harvard University - Harvard Law School
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Posted:
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14 Dec 07
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27 Feb 09
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313 ( 25,985) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Cass R. Sunstein Harvard University - Harvard Law School
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24 Jun 08
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27 Feb 09
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105
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When members of deliberating groups speak with one another, their predeliberation tendencies often become exacerbated as their views become more extreme. The resulting phenomenon-group polarization-has been observed in many settings, and it bears on the actions of juries, administrative tribunals, corporate boards, and other institutions. Polarization can result from rational Bayesian updating by group members, but in many contexts, this rational interpretation of polarization seems implausible. We argue that people are better seen as Credulous Bayesians, who insufficiently adjust for idiosyncratic features of particular environments and put excessive weight on the statements of others in situations of (1) common sources of information; (2) highly unrepresentative group membership; (3) statements that are made to obtain approval; and (4) statements that are designed to manipulate. Credulous Bayesianism can produce extremism and significant blunders-the folly of crowds. We discuss the implications of Credulous Bayesianism for law and politics, including media policy and cognitive diversity on administrative agencies and courts.
polarization, bayesians, behavior, credulous bayesianism, legal theory
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Cass R. Sunstein Harvard University - Harvard Law School
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| Posted: |
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14 Dec 07
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14 Dec 07
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208
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Abstract:
When members of deliberating groups speak with one another, their predeliberation tendencies often become exacerbated as their views become more extreme. The resulting phenomenon - group polarization - has been observed in many settings, and it bears on the actions of juries, administrative tribunals, corporate boards, and other institutions. Polarization can result from rational Bayesian updating by group members, but in many contexts, this rational interpretation of polarization seems implausible. We argue that people are better seen as Credulous Bayesians, who insufficiently adjust for idiosyncratic features of particular environments and put excessive weight on the statements of others where there are 1) common sources of information; 2) highly unrepresentative group membership; 3) statements that are made to obtain approval; and 4) statements that are designed to manipulate. Credulous Bayesianism can produce extremism and significant blunders. We discuss the implications of Credulous Bayesianism for law and politics, including media policy and cognitive diversity on administrative agencies and courts.
extermism, conformity, social interactions, cognitive diversity
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40.
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The Political Economy of Warfare
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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04 Dec 06
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Last Revised:
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04 May 07
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295 ( 27,888) |
2
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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07 Dec 06
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04 May 07
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14
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Warfare is enormously destructive, and yet countries regularly initiate armed conflict against one another. Even more surprisingly, wars are often quite popular with citizens who stand to gain little materially and may lose much more. This paper presents a model of warfare as the result of domestic political calculations. When incumbents have an edge in fighting wars, they may start wars even if those wars run counter to their country's interests. Challengers are particularly likely to urge aggression when they are unlikely to come into power and when the gains from coming to power are large. Leaders who start wars will naturally try to create hatred by emphasizing the threat and despicable character of the rival country. Wars will be more common in dictatorships than in democracies both because dictators have stronger incentives to stay in power and because they have greater control over the media.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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04 Dec 06
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Last Revised:
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04 Dec 06
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281
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2
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Abstract:
Warfare is enormously destructive, and yet countries regularly initiate armed conflict against one another. Even more surprisingly, wars are often quite popular with citizens who stand to gain little materially and may lose much more. This paper presents a model of warfare as the result of domestic political calculations. When incumbents have an edge in fighting wars, they may start wars even if those wars run counter to their country's interests. Challengers are particularly likely to urge aggression when they are unlikely to come into power and when the gains from coming to power are large. Leaders who start wars will naturally try to create hatred by emphasizing the threat and despicable character of the rival country. Wars will be more common in dictatorships than in democracies both because dictators have stronger incentives to stay in power and because they have greater control over the media.
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41.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics William R. Kerr Harvard University - Entrepreneurial Management Unit
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| Posted: |
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07 Oct 08
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02 Jun 09
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294 (28,004)
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5
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Abstract:
Why are some places more entrepreneurial than others? We use Census Bureau data to study local determinants of manufacturing startups across cities and industries. Demographics have limited explanatory power. Overall levels of local customers and suppliers are only modestly important, but new entrants seem particularly drawn to areas with many smaller suppliers, as suggested by Chinitz (1961). Abundant workers in relevant occupations also strongly predict entry. These forces plus city and industry fixed effects explain between sixty and eighty percent of manufacturing entry. We use spatial distributions of natural cost advantages to address partially endogeneity concerns.
Entrepreneurship, Industrial Organization, Agglomeration, Labor Markets, Input-Output Flows, Innovation, Research and Development, Patents
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42.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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06 Nov 01
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Last Revised:
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26 Nov 03
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285 (29,005)
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5
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Abstract:
Many local governments offer rich tax deals to firms to get these firms to come to their cities. In this brief essay, I review the economics of location-based tax incentives. I first address the positive economics of these incentives and present five theories of why these tax incentives occur. I then consider the normative aspects of these incentives and discuss the conditions under which these theories lead to optimal locations of firms and to optimal bundles of public goods. In general, I argue that tax incentives will generally lead to more efficient locational decisions. There may be undesirable redistributional consequences of these incentives, but these are best handled by national redistribution policy.
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43.
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The Divergence of Human Capital Levels Across Cities
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Christopher R. Berry University of Chicago - Irving B. Harris Graduate School of Public Policy Studies Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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30 Aug 05
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25 Jul 09
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279 ( 29,717) |
24
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Christopher R. Berry University of Chicago - Irving B. Harris Graduate School of Public Policy Studies Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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17 Nov 05
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25 Jul 09
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26
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24
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Abstract:
Over the past 30 years, the share of adult populations with college degrees increased more in cities with higher initial schooling levels than in initially less educated places. This tendency appears to be driven by shifts in labor demand as there is an increasing wage premium for skilled people working in skilled cities. In this paper, we present a model where the clustering of skilled people in metropolitan areas is driven by the tendency of skilled entrepreneurs to innovate in ways that employ other skilled people and by the elasticity of housing supply.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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Christopher R. Berry University of Chicago - Irving B. Harris Graduate School of Public Policy Studies Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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30 Aug 05
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Last Revised:
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17 Nov 05
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253
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24
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Abstract:
Over the past 30 years, the share of adult populations with college degrees increased more in cities with higher initial schooling levels than in initially less educated places. This tendency appears to be driven by shifts in labor demand as there is an increasing wage premium for skilled people working in skilled cities. In this paper, we present a model where the clustering of skilled people in metropolitan areas is driven by the tendency of skilled entrepreneurs to innovate in ways that employ other skilled people and by the elasticity of housing supply.
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44.
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Decentralized Employment and the Transformation of the American City
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA)
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Posted:
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09 Feb 01
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Last Revised:
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26 Nov 03
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278 ( 29,833) |
37
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA)
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| Posted: |
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14 Mar 01
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26 Nov 03
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216
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37
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Abstract:
This paper examines the decentralization of employment using zip code data on employment by industry. Most American cities are decentralized - on average less than 16 percent of employment in metropolitan areas is within a three mile radius of the city center. In decentralized cities, the classic stylized facts of urban economics (i.e. prices fall with distance to the city center, commute times rise with distance and poverty falls with distance) no longer hold. Decentralization is most common in manufacturing and least common in services. The human capital level of an industry predicts its centralization, but the dominant factor explaining decentralization is the residential preferences of workers. Political borders also impact employment density which suggests that local government policies significantly influence the location of industry.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA)
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| Posted: |
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09 Feb 01
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Last Revised:
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25 Jun 01
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62
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37
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Abstract:
This paper examines the decentralization of employment using zip code data on employment by industry. Most American cities are decentralized on average less than 16 percent of employment in metropolitan areas is within a three mile radius of the city center. In decentralized cities, the classic stylized facts of urban economics (i.e. prices fall with distance to the city center, commute times rise with distance and poverty falls with distance) no longer hold. Decentralization is most common in manufacturing and least common in services. The human capital level of an industry predicts its centralization, but the dominant factor explaining decentralization is the residential preferences of workers. Political borders also impact employment density which suggests that local government policies significantly influence the location of industry.
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45.
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Strategic Extremism: Why Republicans and Democrats Divide on Religious Values
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Giacomo A. M. Ponzetto CREI - Universitat Pompeu Fabra Jesse M. Shapiro University of Chicago
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Posted:
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04 Oct 04
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Last Revised:
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22 Apr 08
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276 ( 30,100) |
23
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Giacomo A. M. Ponzetto CREI - Universitat Pompeu Fabra Jesse M. Shapiro University of Chicago
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| Posted: |
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29 Oct 04
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14 Nov 04
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31
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23
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Abstract:
Party platforms differ sharply from one another, especially on issues with religious content, such as abortion or gay marriage. Religious extremism in the U.S. appears to be strategically targeted to win elections, since party platforms diverge significantly, while policy outcomes like abortion rates are not affected by changes in the governing party. Given the high returns from attracting the median voter, why do vote-maximizing politicians veer off into extremism? In this paper, we find that strategic extremism depends on an important intensive margin where politicians want to induce their core constituents to vote (or make donations) and the ability to target political messages towards those core constituents. Our model predicts that the political relevance of religious issues is highest when around one-half of the voting population attends church regularly. Using data from across the world and within the U.S., we indeed find a non-monotonic relationship between religious extremism and religious attendance.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Giacomo A. M. Ponzetto CREI - Universitat Pompeu Fabra Jesse M. Shapiro University of Chicago
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| Posted: |
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04 Oct 04
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Last Revised:
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22 Apr 08
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245
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23
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Abstract:
Party platforms differ sharply from one another, especially on issues with religious content, such as abortion or gay marriage. Religious extremism in the U.S. appears to be strategically targeted to win elections, since party platforms diverge significantly, while policy outcomes like abortion rates are not affected by changes in the governing party. Given the high returns from attracting the median voter, why do vote-maximizing politicians veer off into extremism? In this paper, we find that strategic extremism depends on an important intensive margin where politicians want to induce their core constituents to vote (or make donations) and the ability to target political messages towards those core constituents. Our model predicts that the political relevance of religious issues is highest when around one-half of the voting population attends church regularly. Using data from across the world and within the U.S., we indeed find a nonmonotonic relationship between religious extremism and religious attendance.
voting, turnout, extremism
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46.
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Housing Dynamics
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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Posted:
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23 Dec 06
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Last Revised:
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15 Jun 07
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273 ( 30,503) |
14
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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| Posted: |
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15 May 07
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Last Revised:
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15 Jun 07
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238
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14
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Abstract:
The key stylized facts of the housing market are positive serial correlation of price changes at one year frequencies and mean reversion over longer periods, strong persistence in construction, and highly volatile prices and construction levels within markets over time. We calibrate a dynamic model of housing in the spatial equilibrium tradition of Rosen and Roback to see whether such a model can generate these facts. With reasonable parameter values, this model readily explains the mean reversion of prices over five year periods, but cannot explain the observed positive serial correlation at higher frequencies. The model predicts the positive serial correlation of new construction that we see in the data and the volatility of both prices and quantities in the typical market, and it can account for substantial variation on construction intensity across markets. However, the model cannot explain the most volatile markets in terms of low frequency price changes. More research is needed to determine whether measurement error-related data smoothing or market inefficiency can best account for the persistence of high frequency price changes. With respect to the extremely high house price change volatility in certain coastal markets, more research is needed to ascertain whether shocks to interest rates or better measurement of local income variability can match this moment of data without appealing to some type of animal spirits.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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| Posted: |
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23 Dec 06
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Last Revised:
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22 May 07
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35
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Abstract:
The key stylized facts of the housing market are positive serial correlation of price changes at one year frequencies and mean reversion over longer periods, strong persistence in construction, and highly volatile prices and construction levels within markets. We calibrate a dynamic model of housing in the spatial equilibrium tradition of Rosen and Roback to see whether such a model can generate these facts. With reasonable parameter values, this model readily explains the mean reversion of prices over five year periods, but cannot explain the observed positive serial correlation at higher frequencies. The model predicts the positive serial correlation of new construction that we see in the data and the volatility of both prices and quantities in the typical market, but not the volatility of the nation's more extreme markets. The strong serial correlation in annual house price changes and the high volatility of prices in coastal markets are the two biggest housing market puzzles. More research is needed to determine whether measurement error-related data smoothing or market inefficiency can best account for the persistence of high frequency price changes. The best rational explanations of the volatility in high cost markets are shocks to interest rates and unobserved income shocks.
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47.
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Reinventing Boston: 1640-2003
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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25 Oct 03
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Last Revised:
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17 Mar 04
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273 ( 30,503) |
7
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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18 Dec 03
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18 Dec 03
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41
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Abstract:
The three largest cities in colonial America remain at the core of three of America's largest metropolitan areas today. This paper asks how Boston has been able to survive despite repeated periods of crisis and decline. Boston has reinvented itself three times: in the early 19th century as the provider of seafaring human capital for a far flung maritime trading and fishing empire, in the late 19th century as a factory town built on immigrant labor and Brahmin capital, and finally in the late 20th century as a center of the information economy. In all three instances, human capital - admittedly of radically different forms - provided the secret to Boston's rebirth. The history of Boston suggests that a strong base of skilled workers is a more reliable source of long-run urban health.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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25 Oct 03
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Last Revised:
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17 Mar 04
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232
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7
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Abstract:
The three largest cities in colonial America remain at the core of three of America's largest metropolitan areas today. This paper asks how Boston has been able to survive despite repeated periods of crisis and decline. Boston has reinvented itself three times: in the early 19th century as the provider of seafaring human capital for a far flung maritime trading and fishing empire, in the late 19th century as a factory town built on immigrant labor and Brahmin capital, and finally in the late 20th century as a center of the information economy. In all three instances, human capital - admittedly of radically different forms - provided the secret to Boston's rebirth. The history of Boston suggests that a strong base of skilled workers is a more reliable source of long-run urban health.
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48.
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The Social Consequences of Housing
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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Posted:
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17 Dec 00
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Last Revised:
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26 Nov 03
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259 ( 32,323) |
10
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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| Posted: |
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15 Mar 01
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26 Nov 03
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235
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10
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Abstract:
The social capital literature documents a connection between social connection and economic outcomes of interest ranging from government quality to economic growth. Popular authors suggest that housing and architecture are important determinants of social connection. This paper examines the connection between housing structure and social connection. We find that residents of large apartment buildings are more likely to be socially connected with their neighbors, perhaps because the distance between neighbors is lower in apartment buildings. Apartment residents are less involved in local politics, presumably because they are less connected with the public infrastructure and space that surrounds them. Street crime (robbery, auto theft) is also more common around big apartment buildings and we believe that this also occurs because of there is less connection between people in apartments and the streets that surround them.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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| Posted: |
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17 Dec 00
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Last Revised:
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05 Oct 01
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24
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10
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Abstract:
The social capital literature documents a connection between social connection and economic outcomes of interest ranging from government quality to economic growth. Popular authors suggest that housing and architecture are important determinants of social connection. This paper examines the connection between housing structure and social connection. We find that residents of large apartment buildings are more likely to be socially connected with their neighbors, perhaps because the distance between neighbors is lower in apartment buildings. Apartment residents are less involved in local politics, presumably because they are less connected with the public infrastructure and space that surrounds them. Street crime (robbery, auto theft) is also more common around big apartment buildings and we believe that this also occurs because of there is less connection between people in apartments and the streets that surround them.
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49.
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Housing Supply and Housing Bubbles
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Albert Saiz University of Pennsylvania - The Wharton School
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Posted:
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22 Jul 08
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Last Revised:
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14 Jul 09
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255 ( 32,888) |
9
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Albert Saiz University of Pennsylvania - The Wharton School
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| Posted: |
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04 Aug 08
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14 Jul 09
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5
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Like many other assets, housing prices are quite volatile relative to observable changes in fundamentals. If we are going to understand boom-bust housing cycles, we must incorporate housing supply. In this paper, we present a simple model of housing bubbles that predicts that places with more elastic housing supply have fewer and shorter bubbles, with smaller price increases. However, the welfare consequences of bubbles may actually be higher in more elastic places because those places will overbuild more in response to a bubble. The data show that the price run-ups of the 1980s were almost exclusively experienced in cities where housing supply is more inelastic. More elastic places had slightly larger increases in building during that period. Over the past five years, a modest number of more elastic places also experienced large price booms, but as the model suggests, these booms seem to have been quite short. Prices are already moving back towards construction costs in those areas.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department Albert Saiz University of Pennsylvania - The Wharton School
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| Posted: |
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22 Jul 08
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Last Revised:
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22 Jul 08
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250
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9
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Abstract:
Like many other assets, housing prices are quite volatile relative to observable changes in fundamentals. If we are going to understand boom-bust housing cycles, we must incorporate housing supply. In this paper, we present a simple model of housing bubbles which predicts that places with more elastic housing supply have fewer and shorter bubbles, with smaller price increases. However, the welfare consequences of bubbles may actually be higher in more elastic places because those places will overbuild more in response to a bubble.The data show that the price run-ups of the 1980s were almost exclusively experienced incities where housing supply is more inelastic. More elastic places had slightly larger increases in building during that period. Over the past five years, a modest number of more elastic places also experienced large price booms, but as the model suggests, these booms seem to have been quite short. Prices are already moving back towards construction costs in those areas.
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50.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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07 Mar 07
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Last Revised:
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24 Apr 07
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247 (34,120)
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2
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Abstract:
Over the past century, America changed from a nation of distinct cities separated by farmland, to a place where employment and population density is far more continuous. For some purposes, it makes sense to think of the U.S. as consisting of a number of contiguous megaregions. Using the megaregion definitions of the Regional Plan Association, this paper documents the remarkable differences between these areas in productivity, housing prices, commute times and growth rates. Moreover, over the past 20 years, the fastest growing regions have not been those with the highest income or the most attractive climates. Flexible housing supply seems to be the key determinant of regional growth. Land use regulations seem to drive housing supply and determine which regions are growing. A more regional approach to housing supply might reduce the tendency of many localities to block new construction. The Policy Research Institute for the Region at Pinceton University also provided support and funding.
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51.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joshua D. Gottlieb Harvard University - Department of Economics
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| Posted: |
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15 Feb 06
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15 Feb 06
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239 (35,317)
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7
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Abstract:
Cities make it easier for humans to interact, and one of the main advantages of dense, urban areas is that they facilitate social interactions. This paper provides evidence suggesting that the resurgence of big cities in the 1990s is due, in part, to the increased demand for these interactions and due to the reduction in big city crime, which had made it difficult for urban residents to enjoy these social amenities. However, while density is correlated with consumer amenities, we show that it is not correlated with social capital and that there is no evidence that sprawl has hurt civic engagement.
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52.
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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05 Feb 05
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02 Mar 05
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237 (35,605)
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10
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Abstract:
We explore economic model of health behaviors. While the standard economic model of health as an investment is generally supported empirically, the ability of this model to explain heterogeneity across individuals is extremely limited. Most prominently, the correlation of different health behaviors across people is virtually zero, suggest that standard factors such as variation in discount rates or the value of life are not the drivers of behavior. We focus instead on two other factors: genetics; and behavioral-specific situational factors. The first factor is empirically important, and we suspect the second is as well.
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53.
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The Determinants of Punishment: Deterrence, Incapacitation and Vengeance
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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Posted:
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18 May 00
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Last Revised:
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26 Nov 03
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231 ( 36,642) |
7
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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| Posted: |
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09 Aug 00
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26 Nov 03
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195
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Abstract:
Does the economic model of optimal punishment explain the variation in the sentencing of murderers? As the model predicts, we find that murderers with a high expected probability of recidivism receive longer sentences. Sentences are longest in murder types where apprehension rates are low, and where deterrence elasticities appear to be high. However, sentences respond to victim characteristics in a way that is hard to reconcile with optimal punishment. In particular, victim characteristics are important determinants of sentencing among vehicular homicides, where victims are basically random and where the optimal punishment model predicts that victim characteristics should be ignored. Among vehicular homicides, drivers who kill women get 56 percent longer sentences. Drivers who kill blacks get 53 percent shorter sentences.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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| Posted: |
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18 May 00
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Last Revised:
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10 Apr 01
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36
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7
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Abstract:
Does the economic model of optimal punishment explain the variation in the sentencing of murderers? As the model predicts, we find that murderers with a high expected probability of recidivism receive longer sentences. Sentences are longest in murder types where apprehension rates are low, and where deterrence elasticities appear to be high. However, sentences respond to victim characteristics in a way that is hard to reconcile with optimal punishment. In particular, victim characteristics are important determinants of sentencing among vehicular homicides, where victims are basically random and where the optimal punishment model predicts that victim characteristics should be ignored. Among vehicular homicides, drivers who kill women get 56 percent longer sentences. Drivers who kill blacks get 53 percent shorter sentences.
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54.
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Urban Decline and Durable Housing
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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Posted:
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30 Oct 01
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Last Revised:
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29 Mar 05
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225 ( 37,674) |
67
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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| Posted: |
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29 Mar 05
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Last Revised:
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29 Mar 05
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Abstract:
Urban decline is not the mirror image of growth, and durable housing is the primary reason the nature of decline is so different. This paper presents a model of urban decline with durable housing and verifies these implications of the model: (1) city growth rates are skewed so that cities grow more quickly than they decline; (2) urban decline is highly persistent; (3) positive shocks increase population more than they increase housing prices; (4) negative shocks decrease housing prices more than they decrease population; (5) if housing prices are below construction costs, then the city declines; and (6) the combination of cheap housing and weak labor demand attracts individuals with low levels of human capital to declining cities.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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| Posted: |
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17 Nov 01
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Last Revised:
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28 Jan 03
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35
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67
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Abstract:
People continue to live in many big American cities, because in those cities housing costs less than new construction. While cities may lose their productive edge, their houses remain and population falls only when housing depreciates. This paper presents a simple durable housing model of urban decline with several implications which document: (1) urban growth rates are leptokurtotic - cities grow more quickly than they decline, (2) city growth rates are highly persistent, especially amount declining cities, (3) positive shocks increase population more than they increase housing prices, (4) negative shocks decrease housing prices more than they decrease population, (5) the relationship between changes in housing prices and changes in population is strongly concave, and (7) declining cities attract individuals with low levels of human capital.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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| Posted: |
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30 Oct 01
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Last Revised:
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26 Nov 03
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190
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67
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Abstract:
People continue to live in many big American cities, because in those cities housing costs less than new construction. While cities may lose their productive edge, their houses remain and population falls only when housing depreciates. This paper presents a simple durable housing model of urban decline with several implications which document: (1) urban growth rates are leptokurtotic-cities grow more quickly than they decline, (2) city growth rates are highly persistent, especially among declining cities, (3) positive shocks increase population more than they increase housing prices, (4) negative shocks decrease housing prices more than they decrease population, (5) the relationship between changes in housing prices and changes in population is strongly concave, and (6) declining cities attract individuals with low levels of human capital.
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55.
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Public Ownership in the American City
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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Posted:
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17 Oct 01
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Last Revised:
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26 Nov 03
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216 ( 39,323) |
10
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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29 Nov 01
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Last Revised:
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29 Nov 01
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27
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10
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Abstract:
American local governments own and manage a wide portfolio of enterprises, including gas and electricity companies, water systems, subways, bus systems and schools. Existing theories of public ownership, including the presence of natural monopolies, can explain much of the observed municipal ownership. However, the history of America's cities suggests that support for public ownership came from corruption then associated with private ownership of utilities and public transportation. Private firms that either buy or sell to the government will have a strong incentive to bribe government officials to get lower input prices or higher output prices. Because municipal ownership dulls the incentives of the manager and decreases the firm's available cash, public firms may lead to less corruption. Public ownership is also predicted to create inefficiency and excessively large government payrolls.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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17 Oct 01
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Last Revised:
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26 Nov 03
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189
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10
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Abstract:
American local governments own and manage a wide portfolio of enterprises, including gas and electricity companies, water systems, subways, bus systems and schools. Existing theories of public ownership, including the presence of natural monopolies, can explain much of the observed municipal ownership. However, the history of America's cities suggests that support for public ownership came from corruption then associated with private ownership of utilities and public transportation. Private firms that either buy or sell to the government will have a strong incentive to bribe government officials to get lower input prices or higher output prices. Because municipal ownership dulls the incentives of the manager and decreases the firm's available cash, public firms may lead to less corruption. Public ownership is also predicted to create inefficiency and excessively large government payrolls.
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56.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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| Posted: |
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25 Aug 05
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Last Revised:
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25 Aug 05
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215 (39,694)
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47
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Abstract:
A paper presented at the February 2002 conference "Policies to Promote Affordable Housing," cosponsored by the Federal Reserve Bank of New York and New York University's Furman Center for Real Estate and Urban Policy.
housing affordability, urban economics
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57.
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The Causes and Consequences of Land Use Regulation: Evidence from Greater Boston
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bryce Adam Ward Harvard University - Faculty of Arts and Sciences
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Posted:
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10 Oct 06
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Last Revised:
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08 Mar 07
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203 ( 41,883) |
11
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bryce Adam Ward Harvard University - Faculty of Arts and Sciences
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| Posted: |
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20 Oct 06
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Last Revised:
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08 Mar 07
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15
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11
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Abstract:
Over the past 30 years, eastern Massachusetts has seen a remarkable combination of rising home prices and declining supply of new homes. The reductions in new supply don`t appear to reflect a real lack of land, but instead reflect a response to man-made restrictions on development. In this paper, we examine the land-use regulations in greater Boston. There has been a large increase in the number of new regulations, which differ widely over space. Few variables, other than historical density and abundant recreational water, reliably predict these regulations. High lot sizes and other regulations are associated with less construction. The regulations boost prices by decreasing density, but density levels seem far too low to maximize total land value.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bryce Adam Ward Harvard University - Faculty of Arts and Sciences
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| Posted: |
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10 Oct 06
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Last Revised:
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11 Oct 06
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188
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11
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Abstract:
Over the past 30 years, eastern Massachusetts has seen a remarkable combination of rising home prices and declining supply of new homes. The reductions in new supply don't appear to reflect a real lack of land, but instead reflect a response to man-made restrictions on development. In this paper, we examine the land-use regulations in greater Boston. There has been a large increase in the number of new regulations, which differ widely over space. Few variables, other than historical density and abundant recreational water, reliably predict these regulations. High lot sizes and other regulations are associated with less construction. The regulations boost prices by decreasing density, but density levels seem far too low to maximize total land value.
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58.
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The Curley Effect
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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Posted:
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09 May 02
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Last Revised:
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21 Nov 05
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202 ( 42,093) |
11
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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28 Dec 04
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Last Revised:
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21 Nov 05
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21
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4
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Abstract:
James Michael Curley, a four-time mayor of Boston, used wasteful redistribution to his poor Irish constituents and incendiary rhetoric to encourage richer citizens to emigrate from Boston, thereby shaping the electorate in his favor. As a consequence, Boston stagnated, but Curley kept winning elections. We present a model of using redistributive politics to shape the electorate, and show that this model yields a number of predictions opposite from the more standard frameworks of political competition, yet consistent with empirical evidence.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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17 May 02
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Last Revised:
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18 May 02
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21
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8
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Abstract:
James Michael Curley, a four-time mayor of Boston, used wasteful redistribution to his poor Irish constituents and incendiary rhetoric to encourage richer citizens to emigrate from Boston, thereby shaping the electorate in his favor. Boston as a consequence stagnated, but Curley kept winning elections. We present a model of the Curley effect, in which inefficient redistributive policies are sought not by interest groups protecting their rents, but by incumbent politicians trying to shape the electorate through emigration of their opponents or reinforcement of class identities. The model sheds light on ethnic politics in the United States and abroad, as well as on class politics in many countries including Britain.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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09 May 02
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Last Revised:
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26 Nov 03
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160
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8
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Abstract:
James Michael Curley, a four-time mayor of Boston, used wasteful redistribution to his poor Irish constituents and incendiary rhetoric to encourage richer citizens to emigrate from Boston, thereby shaping the electorate in his favor. Boston as a consequence stagnated, but Curley kept winning elections. We present a model of the Curley effect, in which inefficient redistributive policies are sought not by interest groups protecting their rents, but by incumbent politicians trying to shape the electorate through emigration of their opponents or reinforcement of class identities. The model sheds light on ethnic politics in the United States and abroad, as well as on class politics in many countries including Britain.
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59.
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The Social Multiplier
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics Jose A. Scheinkman Princeton University - Department of Economics
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Posted:
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15 Sep 02
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Last Revised:
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26 Nov 03
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200 ( 42,521) |
48
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics Jose A. Scheinkman Princeton University - Department of Economics
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| Posted: |
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05 Oct 02
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Last Revised:
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26 Nov 03
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180
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48
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Abstract:
In many cases, aggregate data is used to make inferences about individual level behavior. If there are social interactions in which one person's actions influence his neighbor's incentives or information, then these inferences are inappropriate. The presence of positive social interactions, or strategic complementarities, implies the existence of a social multiplier where aggregate relationships will overstate individual elasticities. We present a brief model and then estimate the size of the social multiplier in three areas: The impact of education on wages, the impact of demographics on crime and group membership among Dartmouth roommates. In all three areas there appears to be a significant social multiplier.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics Jose A. Scheinkman Princeton University - Department of Economics
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| Posted: |
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15 Sep 02
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Last Revised:
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15 Sep 02
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20
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48
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Abstract:
In many cases, aggregate data is used to make inferences about individual level behavior. If there are social interactions in which one person's actions influence his neighbor's incentives or information, then these inferences are inappropriate. The presence of positive social interactions, or strategic complementarities, implies the existence of a social multiplier where aggregate relationships will overstate individual elasticities. We present a brief model and then estimate the size of the social multiplier in three areas: the impact of education on wages, the impact of demographics on crime and group membership among Dartmouth roommates. In all three areas there appears to be a significant social multiplier.
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60.
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Clusters of Entrepreneurship
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics William R. Kerr Harvard University - Entrepreneurial Management Unit Giacomo A. M. Ponzetto CREI - Universitat Pompeu Fabra
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Posted:
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16 Sep 09
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Last Revised:
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26 Oct 09
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185 ( 47,037) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics William R. Kerr Harvard University - Entrepreneurial Management Unit Giacomo A. M. Ponzetto CREI - Universitat Pompeu Fabra
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| Posted: |
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22 Oct 09
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Last Revised:
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26 Oct 09
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46
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Abstract:
Employment growth is strongly predicted by smaller average establishment size, both across cities and across industries within cities, but there is little consensus on why this relationship exists. Traditional economic explanations emphasize factors that reduce entry costs or raise entrepreneurial returns, thereby increasing net returns and attracting entrepreneurs. A second class of theories hypothesizes that some places are endowed with a greater supply of entrepreneurship. Evidence on sales per worker does not support the higher returns for entrepreneurship rationale. Our evidence suggests that entrepreneurship is higher when fixed costs are lower and when there are more entrepreneurial people.
Entrepreneurship, Industrial Organization, Chinitz, Agglomeration, Clusters, Cities
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics William R. Kerr Harvard University - Entrepreneurial Management Unit Giacomo A. M. Ponzetto CREI - Universitat Pompeu Fabra
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| Posted: |
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16 Sep 09
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Last Revised:
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30 Sep 09
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139
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Abstract:
Employment growth is strongly predicted by smaller average establishment size, both across cities and across industries within cities, but there is little consensus on why this relationship exists. Traditional economic explanations emphasize factors that reduce entry costs or raise entrepreneurial returns, thereby increasing net returns and attracting entrepreneurs. A second class of theories hypothesizes that some places are endowed with a greater supply of entrepreneurship. Evidence on sales per worker does not support the higher returns for entrepreneurship rationale. Our evidence suggests that entrepreneurship is higher when fixed costs are lower and when there are more entrepreneurial people.
entrepreneurship, industrial organization, Chinitz, agglomeration, clusters, cities
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61.
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The Greenness of Cities: Carbon Dioxide Emissions and Urban Development
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA)
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Posted:
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06 Aug 08
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Last Revised:
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29 May 09
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181 ( 47,037) |
2
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA)
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| Posted: |
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18 Aug 08
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29 May 09
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5
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Abstract:
Carbon dioxide emissions may create significant social harm because of global warming, yet American urban development tends to be in low density areas with very hot summers. In this paper, we attempt to quantify the carbon dioxide emissions associated with new construction in different locations across the country. We look at emissions from driving, public transit, home heating, and household electricity usage. We find that the lowest emissions areas are generally in California and that the highest emissions areas are in Texas and Oklahoma. There is a strong negative association between emissions and land use regulations. By restricting new development, the cleanest areas of the country would seem to be pushing new development towards places with higher emissions. Cities generally have significantly lower emissions than suburban areas, and the city-suburb gap is particularly large in older areas, like New York.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew E. Kahn University of California, Los Angeles (UCLA)
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| Posted: |
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06 Aug 08
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Last Revised:
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11 Aug 08
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176
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Abstract:
Carbon dioxide emissions may create significant social harm because of global warming, yet American urban development tends to be in low density areas with very hot summers. In this paper, we attempt to quantify the carbon dioxide emissions associated with new construction in different locations across the country. We look at emissions from driving, public transit, home heating, and household electricity usage. We find that the lowest emissions areas are generally in California and that the highest emissions areas are in Texas and Oklahoma. There is a strong negative association between emissions and land use regulations. By restricting new development, the cleanest areas of the country would seem to be pushing new development towards places with higher emissions. Cities generally have significantly lower emissions than suburban areas, and the city-suburb gap is particularly large in older areas, like New York.
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62.
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Arbitrage in Housing Markets
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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Posted:
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04 Jan 08
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24 Jun 08
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178 ( 47,821) |
7
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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11 Jan 08
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15 Jan 08
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166
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Urban economists understand housing prices with a spatial equilibrium approach that assumes people must be indifferent across locations. Since the spatial no arbitrage condition is inherently imprecise, other economists have turned to different no arbitrage conditions, such as the prediction that individuals must be indifferent between owning and renting. This paper argues the predictions from these non-spatial, financial no arbitrage conditions are also quite imprecise. Owned homes are extremely different from rental units and owners are quite different from renters. The unobserved costs of home owning such as maintenance are also quite large. Furthermore, risk aversion and the high volatility of housing prices compromise short-term attempts to arbitrage by delaying home buying. We conclude that housing cannot be understood with a narrowly financial approach that ignores space any more than it can be understood with a narrowly spatial approach that ignores asset markets.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joseph E. Gyourko University of Pennsylvania - Real Estate Department
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| Posted: |
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04 Jan 08
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Last Revised:
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24 Jun 08
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12
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7
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Abstract:
Urban economists understand housing prices with a spatial equilibrium approach that assumes people must be indifferent across locations. Since the spatial no arbitrage condition is inherently imprecise, other economists have turned to different no arbitrage conditions, such as the prediction that individuals must be indifferent between owning and renting. This paper argues the predictions from these non-spatial, financial no arbitrage conditions are also quite imprecise. Owned homes are extremely different from rental units and owners are quite different from renters. The unobserved costs of home owning such as maintenance are also quite large. Furthermore, risk aversion and the high volatility of housing pries compromise short-term attempts to arbitrage by delaying home buying. We conclude that housing cannot be understood with a narrowly financial approach that ignores space any more than it can be understood with a narrowly spatial approach that ignores asset markets.
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63.
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What Do Prosecutors Maximize? An Analysis of the Federalization of Drug Crimes
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Daniel P. Kessler Stanford Graduate School of Business Anne Morrison Piehl Rutgers University - Department of Economics
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Posted:
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14 Jan 00
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Last Revised:
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23 Apr 08
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166 ( 51,181) |
11
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Daniel P. Kessler Stanford Graduate School of Business Anne Morrison Piehl Rutgers University - Department of Economics
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16 Mar 00
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23 Apr 08
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39
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Recent legislation has expanded the jurisdiction of the federal government over crimes that were traditionally prohibited only by state law. We model the decision-making process of state and federal prosecutors, and the determinants of prosecutors` decisions to allocate drug cases to the state versus the federal systems. Using 1991 surveys of state and federal inmates incarcerated for drug crimes, we find that individuals who hire private attorneys and who are high-human-capital and successful in the legitimate sector are more likely to end up in the federal system. This is consistent with the model in which prosecutors maximize both the payoffs from eliminating crime and their private human capital.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Daniel P. Kessler Stanford Graduate School of Business Anne Morrison Piehl Rutgers University - Department of Economics
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14 Jan 00
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08 Aug 00
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127
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Abstract:
Recent legislation has expanded the jurisdiction of the federal government over crimes that were traditionally prohibited only by state law. We model the decision-making process of state and federal prosecutors, and the determinants of prosecutors' decisions to allocate drug cases to the state versus the federal systems. Using 1991 surveys of state and federal inmates incarcerated for drug crimes, we find that individuals who hire private attorneys and who are high human capital and successful in the legitimate sector are more likely to end up in the federal system. This is consistent with the model in which prosecutors maximize both the payoffs from eliminating crime and their private human capital.
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64.
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The Rise of the Sunbelt
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Kristina Tobio Harvard University - John F. Kennedy School of Government
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Posted:
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25 Apr 07
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11 Jul 07
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160 ( 53,058) |
14
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Kristina Tobio Harvard University - John F. Kennedy School of Government
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| Posted: |
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27 Jun 07
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11 Jul 07
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14
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14
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In the last 50 years, population and incomes have increased steadily throughout much of the Sunbelt. This paper assesses the relative contributions of rising productivity, rising demand for Southern amenities and increases in housing supply to the growth of warm areas, using data on income, housing price and population growth. Before 1980, economic productivity increased significantly in warmer areas and drove the population growth in those places. Since 1980, productivity growth has been more modest, but housing supply growth has been enormous. We infer that new construction in warm regions represents a growth in supply, rather than demand, from the fact that prices are generally falling relative to the rest of the country. The relatively slow pace of housing price growth in the Sunbelt, relative to the rest of the country and relative to income growth, also implies that there has been no increase in the willingness to pay for sun-related amenities. As such, it seems that the growth of the Sunbelt has little to do with the sun.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Kristina Tobio Harvard University - John F. Kennedy School of Government
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| Posted: |
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25 Apr 07
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Last Revised:
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30 May 07
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146
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14
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Abstract:
In the last 50 years, population and incomes have increased steadily throughout much of the Sunbelt. This paper assesses the relative contributions of rising productivity, rising demand for Southern amenities and increases in housing supply to the growth of warm areas, using data on income, housing price and population growth. Before 1980, economic productivity increased significantly in warmer areas and drove the population growth in those places. Since 1980, productivity growth has been more modest, but housing supply growth has been enormous. We infer that new construction in warm regions represents a growth in supply, rather than demand, from the fact that prices are generally falling relative to the rest of the country. The relatively slow pace of housing price growth in the Sunbelt, relative to the rest of the country and relative to income growth, also implies that there has been no increase in the willingness to pay for sun-related amenities. As such, it seems that the growth of the Sunbelt has little to do with the sun.
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65.
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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21 Feb 08
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Last Revised:
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14 May 08
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156 (54,303)
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2
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Abstract:
Are individuals more likely to smoke when they are surrounded by smokers? In this paper, we examine the evidence for peer effects in smoking. We address the endogeneity of peers by looking at the impact of workplace smoking bans on spousal and peer group smoking. Using these bans as an instrument, we find that individuals whose spouses smoke are 40 percent more likely to smoke themselves. We also find evidence for the existence of a social multiplier in that the impact of smoking bans and individual income becomes stronger at higher levels of aggregation. This social multiplier could explain the large time series drop in smoking among some demographic groups.
Welfare, Health Care, Social Policy
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66.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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04 Jan 03
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Last Revised:
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12 Nov 02
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151 (56,012)
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1
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Abstract:
Advocates of rent control often argue that rent control aids the mixing of rich and poor, and perhaps of the races as well. Economic theory does not necessarily predict that rent control will reduce segregation. The best case for rent control as an aid to integration is that it creates pockets of low rent (and low quality) apartments in expensive cities. However, by creating an excess of demand over supply, rent control ensures that apartments will be allocated on the basis of landlord preferences, which may in fact be segregationist. Furthermore, when rent control induces poor renters to live in rich cities, those poor renters are generally older, long term renters, who are less likely to have young children living at home and are less likely to benefit most from integration. Empirically, rent control seems to have allowed some poorer (and older) tenants to live in expensive Manhattan, but rent control in the declining cities of New Jersey seems to have increased the isolation of the poor. Rent control is a very socially costly means of occasionally getting integration, and housing vouchers or supply-side policies seem likely to be much more effective.
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67.
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Social Capital and Urban Growth
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Charles Redlick Harvard University - Department of Economics
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Posted:
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09 Oct 08
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25 Nov 08
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146 ( 56,012) |
1
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Charles Redlick Harvard University - Department of Economics
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| Posted: |
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15 Nov 08
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15 Nov 08
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98
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Abstract:
Social capital is often place-specific while schooling is portable, so the prospect of migration may reduce the returns to social capital and increase the returns to schooling. If social capital matters for urban success, it is possible that an area can get caught in a bad equilibrium where the prospect of out-migration reduces social capital investment and a lack of social capital investment makes out-migration more appealing. We present a simple model of that process and then test its implications. We find little evidence to suggest that social capital is correlated with either area growth or rates of out-migration. We do, however, find significant differences in the returns to human capital across space, and a significant pattern of skilled people disproportionately leaving declining areas. For people in declining areas, the prospect of out migration may increase the returns to investment in human capital, but it does not seem to impact investment in social capital.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Charles Redlick Harvard University - Department of Economics
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| Posted: |
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09 Oct 08
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Last Revised:
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25 Nov 08
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48
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Abstract:
Social capital is often place-specific while schooling is portable, so the prospect of migration may reduce the returns to social capital and increase the returns to schooling. If social capital matters for urban success, it is possible that an area can get caught in a bad equilibrium where the prospect of out-migration reduces social capital investment and a lack of social capital investment makes out-migration more appealing. We present a simple model of that process and then test its implications. We find little evidence to suggest that social capital is correlated with either area growth or rates of out-migration. We do, however, find significant differences in the returns to human capital across space, and a significant pattern of skilled people disproportionately leaving declining areas. For people in declining areas, the prospect of out-migration may increase the returns to investment in human capital, but it does not seem to impact investment in social capital.
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68.
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What is Social Capital? The Determinants of Trust and Trustworthiness
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics David I. Laibson Harvard University - Department of Economics Jose A. Scheinkman Princeton University - Department of Economics Christine L. Soutter Harvard University - Department of Psychology
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Posted:
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10 Jan 00
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Last Revised:
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26 Nov 03
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143 ( 58,910) |
16
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics David I. Laibson Harvard University - Department of Economics Jose A. Scheinkman Princeton University - Department of Economics Christine L. Soutter Harvard University - Department of Psychology
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| Posted: |
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26 Jul 00
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Last Revised:
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26 Nov 03
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0
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Abstract:
Using a sample of Harvard undergraduates, we analyze trust and social capital in two experiments. Trusting behavior and trustworthiness rise with social connection; differences in race and nationality reduce the level of trustworthiness. Certain individuals appear to be persistently more trusting, but these people do not say they are more trusting in surveys. Survey questions about trust predict trustworthiness not trust. Only children are less trustworthy. People behave in a more trustworthy manner towards higher status individuals, and therefore status increases earnings in the experiment. As such, high status persons can be said to have more social capital.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics David I. Laibson Harvard University - Department of Economics Jose A. Scheinkman Princeton University - Department of Economics Christine L. Soutter Harvard University - Department of Psychology
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| Posted: |
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10 Jan 00
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Last Revised:
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26 Jul 00
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143
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16
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Abstract:
Using a sample of Harvard undergraduates, we analyze trust and social capital in two experiments. Trusting behavior and trustworthiness rise with social connection; differences in race and nationality reduce the level of trustworthiness. Certain individuals appear to be persistently more trusting, but these people do not say they are more trusting in surveys. Survey questions about trust predict trustworthiness not trust. Only children are less trustworthy. People behave in a more trustworthy manner towards higher status individuals, and therefore status increases earnings in the experiment. As such, high status persons can be said to have more social capital.
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69.
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Work and Leisure in the U.S. and Europe: Why So Different?
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Alberto F. Alesina Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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Posted:
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01 Jun 05
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Last Revised:
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10 Nov 05
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141 ( 59,633) |
37
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Alberto F. Alesina Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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| Posted: |
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17 Aug 05
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Last Revised:
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10 Nov 05
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44
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37
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Americans average 25.1 working hours per person in working age per week, but the Germans average 18.6 hours. The average American works 46.2 weeks per year, while the French average 40 weeks per year. Why do western Europeans work so much less than Americans? Recent work argues that these differences result from higher European tax rates, but the vast empirical labor supply literature suggests that tax rates can explain only a small amount of the differences in hours between the U.S. and Europe. Another popular view is that these differences are explained by long-standing European 'culture', but Europeans worked more than Americans as late as the 1960s. In this paper, we argue that European labor market regulations, advocated by unions in declining European industries who argued 'work less, work all' explain the bulk of the difference between the U.S. and Europe. These policies do not seem to have increased employment, but they may have had a more society-wide influence on leisure patterns because of a social multiplier where the returns to leisure increase as more people are taking longer vacations.
Hours worked, labor unions, taxation, Europe
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Alberto F. Alesina Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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| Posted: |
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01 Jun 05
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Last Revised:
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17 Aug 05
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97
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37
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Abstract:
Americans average 25.1 working hours per person in working age per week, but the Germans average 18.6 hours. The average American works 46.2 weeks per year, while the French average 40 weeks per year. Why do western Europeans work so much less than Americans? Recent work argues that these differences result from higher European tax rates, but the vast empirical labor supply literature suggests that tax rates can explain only a small amount of the differences in hours between the U.S. and Europe. Another popular view is that these differences are explained by long-standing European "culture", but Europeans worked more than Americans as late as the 1960s. In this paper, we argue that European labor market regulations, advocated by unions in declining European industries who argued "work less, work all" explain the bulk of the difference between the U.S. and Europe. These policies do not seem to have increased employment, but they may have had a more society-wide influence on leisure patterns because of a social multiplier where the returns to leisure increase as more people are taking longer vacations.
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70.
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Extremism and Social Learning
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Cass R. Sunstein Harvard University - Harvard Law School
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Posted:
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21 Dec 07
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Last Revised:
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03 Jan 08
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140 ( 60,000) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Cass R. Sunstein Harvard University - Harvard Law School
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| Posted: |
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03 Jan 08
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Last Revised:
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03 Jan 08
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123
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Abstract:
When members of deliberating groups speak with one another, their predeliberation tendencies often become exacerbated as their views become more extreme. The resulting phenomenon - group polarization - has been observed in many settings, and it bears on the actions of juries, administrative tribunals, corporate boards, and other institutions. Polarization can result from rational Bayesian updating by group members, but in many contexts, this rational interpretation of polarization seems implausible. We argue that people are better seen as Credulous Bayesians, who insufficiently adjust for idiosyncratic features of particular environments and put excessive weight on the statements of others where there are 1) common sources of information; 2) highly unrepresentative group membership; 3) statements that are made to obtain approval; and 4) statements that are designed to manipulate. Credulous Bayesianism can produce extremism and significant blunders. We discuss the implications of Credulous Bayesianism for law and politics, including media policy and cognitive diversity on administrative agencies and courts.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Cass R. Sunstein Harvard University - Harvard Law School
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| Posted: |
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21 Dec 07
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Last Revised:
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28 Dec 07
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17
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Abstract:
When members of deliberating groups speak with one another, their predeliberation tendencies often become exacerbated as their views become more extreme. The resulting phenomenon - group polarization - has been observed in many settings, and it bears on the actions of juries, administrative tribunals, corporate boards, and other institutions. Polarization can result from rational Bayesian updating by group members, but in many contexts, this rational interpretation of polarization seems implausible. We argue that people are better seen as Credulous Bayesians, who insufficiently adjust for idiosyncratic features of particular environments and put excessive weight on the statements of others where there are 1) common sources of information; 2) highly unrepresentative group membership; 3) statements that are made to obtain approval; and 4) statements that are designed to manipulate. Credulous Bayesianism can produce extremism and significant blunders. We discuss the implications of Credulous Bayesianism for law and politics, including media policy and cognitive diversity on administrative agencies and courts.
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71.
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Opportunities, Race, and Urban Location: The Influence of John Kain
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Eric A. Hanushek Stanford University - Hoover Institution on War, Revolution and Peace John M. Quigley University of California, Berkeley - Department of Economics
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Posted:
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10 Mar 04
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Last Revised:
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11 Aug 04
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128 ( 64,814) |
1
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Eric A. Hanushek Stanford University - Hoover Institution on War, Revolution and Peace John M. Quigley University of California, Berkeley - Department of Economics
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| Posted: |
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30 Jul 04
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Last Revised:
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11 Aug 04
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105
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1
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Abstract:
Today, no economist studying the spatial economy of urban areas would ignore the effects of race on housing markets and labor market opportunities, but this was not always the case. Through what can be seen as a consistent and integrated research plan, John Kain developed many central ideas of urban economics but, more importantly, legitimized and encouraged scholarly consideration of the geography of racial opportunities. His provocative (and prescient) study of the linkage between housing segregation and the labor market opportunities of Blacks was a natural outgrowth of his prior work on employment decentralization and housing constraints on Black households. His more recent program of research on school outcomes employing detailed administrative data was an extension of the same empirical interest in how the economic opportunities of minority households vary with location. This paper identifies the influence of John Kain's ideas on different areas of research and suggests that his scientific work was thoroughly interrelated.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Eric A. Hanushek Stanford University - Hoover Institution on War, Revolution and Peace John M. Quigley University of California, Berkeley - Department of Economics
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| Posted: |
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10 Mar 04
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Last Revised:
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10 Mar 04
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23
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1
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Abstract:
Today, no economist studying the spatial economy of urban areas would ignore the effects of race on housing markets and labor market opportunities, but this was not always the case. Through what can be seen as a consistent and integrated research plan, John Kain developed many central ideas of urban economics but, more importantly, legitimized and encouraged scholarly consideration of the geography of racial opportunities. His provocative (and prescient) study of the linkage between housing segregation and the labor market opportunities of Blacks was a natural outgrowth of his prior work on employment decentralization and housing constraints on Black households. His more recent program of research on school outcomes employing detailed administrative data was an extension of the same empirical interest in how the economic opportunities of minority households vary with location. This paper identifies the influence of John Kain's ideas on different areas of research and suggests that his scientific work was thoroughly interrelated.
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72.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Giacomo A. M. Ponzetto CREI - Universitat Pompeu Fabra
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| Posted: |
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03 Jan 08
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Last Revised:
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03 Jan 08
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122 (67,424)
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4
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Abstract:
Urban proximity can reduce the costs of shipping goods and speed the flow of ideas. Improvements in communication technology might erode these advantages and allow people and firms to decentralize. However, improvements in transportation and communication technology can also increase the returns to new ideas, by allowing those ideas to be used throughout the world. This paper presents a model that illustrates these two rival effects that technological progress can have on cities. We then present some evidence suggesting that the model can help us to understand why the past thirty-five years have been kind to idea-producing places, like New York and Boston, and devastating to goods-producing cities, like Cleveland and Detroit.
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73.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Matthew Resseger Harvard University - Faculty of Arts and Sciences Kristina Tobio Harvard University - John F. Kennedy School of Government
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| Posted: |
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12 Nov 08
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Last Revised:
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12 Nov 08
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112 (72,822)
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Abstract:
What impact does inequality have on metropolitan areas? Crime rates are higher in places with more inequality, and people in unequal cities are more likely to say that they are unhappy. There is also a negative association between local inequality and the growth of both income and population, once we control for the initial distribution of skills. What determines the degree of inequality across metropolitan areas? Twenty years ago, metropolitan inequality was strongly associated with poverty, but today, inequality is more strongly linked to the presence of the wealthy. Inequality in skills can explain about one third of the variation in income inequality, and that skill inequality is itself explained by historical schooling patterns and immigration. There are also substantial differences in the returns to skill, related to local concentrations in different industries, and these too are strongly correlated with inequality.
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74.
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Aggregation Reversals and the Social Formation of Beliefs
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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Posted:
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14 Apr 07
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26 Jul 07
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112 ( 72,329) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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17 Apr 07
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18 Apr 07
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101
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Abstract:
In the past two elections, richer people were more likely to vote Republican while richer states were more likely to vote Democratic. This switch is an aggregation reversal, where an individual relationship, like income and Republicanism, is reversed at some level of aggregation. Aggregation reversals can occur when an independent variable impacts an outcome both directly and indirectly through a correlation with beliefs. For example, income increases the desire for low taxes but decreases belief in Republican social causes. If beliefs are learned socially, then aggregation can magnify the connection between the independent variable and beliefs, which can cause an aggregation reversal. We estimate the model's parameters for three examples of aggregation reversals, and show with these parameters that the model predicts the observed reversals.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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| Posted: |
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14 Apr 07
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Last Revised:
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26 Jul 07
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11
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3
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Abstract:
In the past two elections, richer people were more likely to vote Republican while richer states were more likely to vote Democratic. This switch is an aggregation reversal, where an individual relationship, like income and Republicanism, is reversed at some level of aggregation. Aggregation reversals can occur when an independent variable impacts an outcome both directly and indirectly through a correlation with beliefs. For example, income increases the desire for low taxes but decreases belief in Republican social causes. If beliefs are learned socially, then aggregation can magnify the connection between the independent variable and beliefs, which can cause an aggregation reversal. We estimate the model's parameters for three examples of aggregation reversals, and show with these parameters that the model predicts the observed reversals.
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75.
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The Economics of Place-Making Policies
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joshua D. Gottlieb Harvard University - Department of Economics
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Posted:
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08 Oct 08
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09 Dec 08
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108 ( 74,382) |
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joshua D. Gottlieb Harvard University - Department of Economics
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15 Nov 08
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09 Dec 08
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101
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Should the national government undertake policies aimed at strengthening the economies of particular localities or regions? Agglomeration economies and human capital spillovers suggest that such policies could enhance welfare. However, the mere existence of agglomeration externalities does not indicate which places should be subsidized. Without a better understanding of nonlinearities in these externalities, any government spatial policy is as likely to reduce as to increase welfare. Transportation spending has historically done much to make or break particular places, but current transportation spending subsidizes low-income, low-density places where agglomeration effects are likely to be weakest. Most large-scale place-oriented policies have had little discernable impact. Some targeted policies such as Empowerment Zones seem to have an effect but are expensive relative to their achievements. The greatest promise for a national place-based policy lies in impeding the tendency of highly productive areas to restrict their own growth through restrictions on land use.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joshua D. Gottlieb Harvard University - Department of Economics
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08 Oct 08
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Last Revised:
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08 Oct 08
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7
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4
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Abstract:
Should the national government undertake policies aimed at strengthening the economies of particular localities or regions? Agglomeration economies and human capital spillovers suggest that such policies could enhance welfare. However, the mere existence of agglomeration externalities does not indicate which places should be subsidized. Without a better understanding of nonlinearities in these externalities, any government spatial policy is as likely to reduce as to increase welfare. Transportation spending has historically done much to make or break particular places, but current transportation spending subsidizes low-income, low-density places where agglomeration effects are likely to be weakest. Most large-scale place-oriented policies have had little discernable impact. Some targeted policies such as Empowerment Zones seem to have an effect but are expensive relative to their achievements. The greatest promise for a national place-based policy lies in impeding the tendency of highly productive areas to restrict their own growth through restrictions on land use.
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76.
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Is the Melting Pot Still Hot? Explaining the Resurgence of Immigrant Segregation
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jacob L. Vigdor Duke University - Terry Sanford Institute of Public Policy
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Posted:
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11 May 05
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03 Aug 08
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105 ( 75,991) |
12
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jacob L. Vigdor Duke University - Terry Sanford Institute of Public Policy
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11 May 05
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03 Aug 08
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84
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This paper uses decennial Census data to examine trends in immigrant segregation in the United States between 1910 and 2000. Immigrant segregation declined in the first half of the century, but has been rising steadily over the past three decades. Analysis of restricted access 1990 Census microdata suggests that this rise would be even more striking if the native-born children of immigrants could be consistently excluded from the analysis. We analyze panel and cross-sectional variation in immigrant segregation, as well as housing price patterns across metropolitan areas, to test four hypotheses of immigrant segregation. Immigration itself has surged in recent decades, but the tendency for newly arrived immigrants to be younger and of lower socioeconomic status explains very little of the recent rise in immigrant segregation. We also find little evidence of increased nativism in the housing market. Evidence instead points to changes in urban form, manifested in particular as native-driven suburbanization and the decline of public transit as a transportation mode, as a central explanation for the new immigrnt segregation.
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jacob L. Vigdor Duke University - Terry Sanford Institute of Public Policy
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06 Jun 05
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06 Jun 05
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This paper uses decennial Census data to examine trends in immigrant segregation in the United States between 1910 and 2000. Immigrant segregation declined in the first half of the century, but has been rising over the past few decades. Analysis of restricted access 1990 Census microdata suggests that this rise would be even more striking if the native-born children of immigrants could be consistently excluded from the analysis. We analyze longitudinal variation in immigrant segregation, as well as housing price patterns across metropolitan areas, to test four hypotheses of immigrant segregation. Immigration itself has surged in recent decades, but the tendency for newly arrived immigrants to be younger and of lower socioeconomic status explains very little of the recent rise in immigrant segregation. We also find little evidence of increased nativism in the housing market. Evidence instead points to changes in urban form, manifested in particular as native-driven suburbanization and the decline of public transit as a transportation mode, as a central explanation for the new immigrant segregation.
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77.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics David M. Cutler Harvard University - Department of Economics Jacob L. Vigdor Duke University - Terry Sanford Institute of Public Policy
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21 Feb 08
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03 Aug 08
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104 (76,528)
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Recent studies provide conflicting evidence on the connection between ethnic or racial neighborhood segregation and outcomes. Some studies find that residence in an enclave is beneficial, some reach the opposite conclusion, and still others imply that any relationship is small. One hypothesis is that studies differ because the impact of segregation varies across groups, perhaps because its impact is more benign for better-educated groups. This paper presents new evidence on this hypothesis using data on first-generation immigrants in the United States. We confront the endogenous selection into residential enclaves and find that selection into enclave neighborhoods is on balance negative. Correcting for this selection produces positive mean effects of segregation, and a positive correlation between group average human capital and the impact of segregation.
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78.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Claudia Goldin Harvard University - Department of Economics
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05 Oct 05
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24 Aug 09
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93 (82,923)
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The United States today, according to most studies, is among the least corrupt nations in the world. But America's past was checkered with political scandal and widespread corruption that would not seem unusual compared with the most corrupt developing nation today. We construct a "corruption and fraud index" using word counts from a large number of newspapers for 1815 to 1975, supplemented with other historical facts. The index reveals that America experienced a substantial decrease in corruption from 1870 to 1920, particularly from the late-1870s to the mid-1880s and again in the 1910s. At its peak in the 1870s the "corruption and fraud index" is about five times its level from the end of the Progressive Era to the 1970s. If the United States was once considerably more corrupt than it is today, then America's history should offer lessons about how to reduce corruption. How did America become a less corrupt polity, economy, and society? We review the findings and insights from a series of essays for a conference volume, Corruption and Reform: Lessons from America's History, for which this paper is the introduction that attempt to understand the remarkable evolution of corruption and reform in U.S. history.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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79.
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Alberto F. Alesina Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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04 Oct 01
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04 Oct 01
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89 (85,544)
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European countries are much more generous to the poor relative to the US level of generosity. Economic models suggest that redistribution is a function of the variance and skewness of the pre-tax income distribution, the volatility of income (perhaps because of trade shocks), the social costs of taxation and the expected income mobility of the median voter. None of these factors appear to explain the differences between the US and Europe. Instead, the differences appear to be the result of racial heterogeneity in the US and American political institutions. Racial animosity in the US makes redistribution to the poor, who are disproportionately black, unappealing to many voters. American political institutions limited the growth of a socialist party, and more generally limited the political power of the poor.
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80.
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Bruce Sacerdote Dartmouth College - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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13 Jan 01
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05 Oct 01
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75 (95,579)
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33
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In the United States, religious attendance rises sharply with education across individuals, but religious attendance declines sharply with education across denominations. This puzzle is explained if education both increases the returns to social connection and reduces the extent of religious belief. The positive effect of education on sociability explains the positive education-religion relationship. The negative effect of education on religious belief causes more educated individuals to sort into less fervent religions, which explains the negative relationship between education and religion across denominations. Cross-country differences in the impact of education on religious belief can explain the large cross-country variation in the education-religion connection. These cross-country differences in the education-belief relationship can be explained by political factors (such as communism) which lead some countries to use state-controlled education to discredit religion.
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81.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics Jose A. Scheinkman Princeton University - Department of Economics
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04 Aug 00
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Last Revised:
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04 Aug 00
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57 (111,532)
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183
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The high degree of variance of crime rates across space (and across time) is one of the oldest puzzles in the social sciences (see Quetelet (1835)). Our empirical work strongly suggests that this variance is not the result of observed or unobserved geographic attributes. This paper presents a model where social interactions create enough covariance across individuals to explain the high cross- city variance of crime rates. This model provides a natural index of social interactions which can compare the degree of social interaction across crimes, across geographic 1units and across time. Our index gives similar results for different data samples and suggests that the amount of social interactions are highest in petty crimes (such as larceny and auto theft), moderate in more serious crimes (assault, burglary and robbery) and almost negligible in murder and rape. The index of social interactions is also applied to non-criminal choices and we find that there is substantial interaction in schooling choice.
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82.
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Matthew Aaron Gentzkow University of Chicago - Booth School of Business Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Claudia Goldin Harvard University - Department of Economics
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| Posted: |
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06 Oct 04
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22 Aug 09
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56 (112,457)
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17
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A free and informative press is widely agreed to be crucial to the democratic process today. But throughout much of the nineteenth century U.S. newspapers were often public relations tools funded by politicians, and newspaper independence was a rarity. The newspaper industry underwent fundamental changes between 1870 and 1920 as the press became more informative and less partisan. Whereas 11 percent of urban dailies were "independent" in 1870, 62 percent were in 1920. The rise of the informative press was the result of increased scale and competitiveness in the newspaper industry caused by technological progress in the newsprint and newspaper industries. We examine the press coverage surrounding two major political scandals -- Credit Mobilier in the early 1870s and Teapot Dome in the 1920s. The analysis demonstrates a sharp reduction in bias and charged language in the half century after 1870.From 1870 to 1920, when corruption appears to have declined significantly within the United States, the press became more informative, less partisan, and expanded its circulation considerably. It seems a reasonable hypothesis that the rise of the informative press was one of the reasons why the corruption of the Gilded Age was sharply reduced during the subsequent Progressive Era.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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83.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Giacomo A. M. Ponzetto CREI - Universitat Pompeu Fabra Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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15 May 06
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19 Jun 06
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52 (116,464)
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31
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Abstract:
Across countries, education and democracy are highly correlated. We motivate empirically and then model a causal mechanism explaining this correlation. In our model, schooling teaches people to interact with others and raises the benefits of civic participation, including voting and organizing. In the battle between democracy and dictatorship, democracy has a wide potential base of support but offers weak incentives to its defenders. Dictatorship provides stronger incentives to a narrower base. As education raises the benefits of civic participation, it raises the support for more democratic regimes relative to dictatorships. This increases the likelihood of democratic revolutions against dictatorships, and reduces that of successful anti-democratic coups.
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84.
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Not-For-Profit Entrepreneurs
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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Posted:
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26 Dec 98
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Last Revised:
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06 Mar 06
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50 (118,524) |
47
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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26 Jul 00
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26 Nov 03
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Abstract:
Entrepreneurs who start new firms may choose not-for-profit status as a means of committing to soft incentives. Such incentives protect donors, volunteers, consumers and employees from ex post expropriation of profits by the entrepreneur. We derive conditions under which completely self-interested entrepreneurs opt for not-for-profit status, despite the fact that this status limits their ability to enjoy the profits of their enterprises. When entrepreneurs have a taste for producing high quality products, the incentives are even softer, and, moreover, non-profit status can serve as a signal of that taste. We also show that even in the absence of tax advantages, unrestricted donations would flow to non-profits rather than for-profit firms because donations have more significant influence on the decisions of the non-profits.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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26 Dec 98
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Last Revised:
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06 Mar 06
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50
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47
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Abstract:
Entrepreneurs who start new firms may choose not-for-profit status as a means of committing to soft incentives. Such incentives protect donors, volunteers, consumers and employees from ex post expropriation of profits by the entrepreneur. We derive conditions under which completely self-interested entrepreneurs opt for not-for-profit status, despite the fact that this status limits their ability to enjoy the profits of their enterprises. When entrepreneurs have a taste for producing high quality products, the incentives are even softer, and, moreover, non-profit status can serve as a signal of that taste. We also show that even in the absence of tax advantages, unrestricted donations would flow to non-profits rather than for-profit firms because donations have more significant influence on the decisions of the non-profits.
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85.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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| Posted: |
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21 Dec 07
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Last Revised:
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28 Dec 07
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45 (124,040)
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1
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Abstract:
The economic approach to cities relies on a spatial equilibrium for workers, employers and builders. The worker's equilibrium implies that positive attributes in one location, like access to downtown or high wages, are offset by negative attributes, like high housing prices. The employer's equilibrium requires that high wages be offset by a high level of productivity, perhaps due to easy access to customers or suppliers. The search for the sources of productivity differences that can justify high wages is the basis for the study of agglomeration economies which has been a significant branch of urban economics in the past 20 years. The builder's equilibrium condition pushes us to understand the causes of supply differences across space that can explain why some places have abundant construction and low prices while others have little construction and high prices. Since the economic theory of cities emphasizes a search for exogenous causes of endogenous outcomes like local wages, housing prices and city growth, it is unsurprising that the economic empirics on cities have increasingly focused on the quest for exogenous sources of variation. The economic approach to urban policy emphasizes the need to focus on people, rather than places, as the ultimate objects of policy concern and the need for policy to anticipate the mobility of people and firms.
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86.
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David M. Cutler Harvard University - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics
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15 May 06
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24 Aug 06
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43 (126,353)
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9
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Abstract:
While Americans are less healthy than Europeans along some dimensions (like obesity), Americans are significantly less likely to smoke than their European counterparts. This difference emerged in the 1970s and it is biggest among the most educated. The puzzle becomes larger once we account for cigarette prices and anti-smoking regulations, which are both higher in Europe. There is a nonmonotonic relationship between smoking and income; among richer countries and people, higher incomes are associated with less smoking. This can account for about one-fifth of the U.S./Europe difference. Almost one-half of the smoking difference appears to be the result of differences in beliefs about the health effects of smoking; Europeans are generally less likely to think that cigarette smoking is harmful.
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87.
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Glenn David Ellison Massachusetts Institute of Technology (MIT) - Department of Economics Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics William R. Kerr Harvard University - Entrepreneurial Management Unit
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| Posted: |
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27 Jun 07
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Last Revised:
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02 Jun 09
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42 (127,584)
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23
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Many industries are geographically concentrated. Many mechanisms that could account for such agglomeration have been proposed. We note that these theories make different predictions about which pairs of industries should be coagglomerated. We discuss the measurement of coagglomeration and use data from the Census Bureau's Longitudinal Research Database from 1972 to 1997 to compute pairwise coagglomeration measurements for U.S. manufacturing industries. Industry attributes are used to construct measures of the relevance of each of Marshall's three theories of industry agglomeration to each industry pair: (1) agglomeration saves transport costs by proximity to input suppliers or final consumers, (2) agglomeration allows for labor market pooling, and (3) agglomeration facilitates intellectual spillovers. We assess the importance of the theories via regressions of coagglomeration indices on these measures. Data on characteristics of corresponding industries in the United Kingdom are used as instruments. We find evidence to support each mechanism. Our results suggest that input-output dependencies are the most important factor, followed by labor pooling.
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88.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Joshua D. Gottlieb Harvard University - Department of Economics
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| Posted: |
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24 Mar 09
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Last Revised:
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24 Mar 09
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40 (129,991)
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Abstract:
Empirical research on cities starts with a spatial equilibrium condition: workers and firms are assumed to be indifferent across space. This condition implies that research on cities is different from research on countries, and that work on places within countries needs to consider population, income and housing prices simultaneously. Housing supply elasticity will determine whether urban success shows up in more people or higher incomes. Urban economists generally accept the existence of agglomeration economies, which exist when productivity rises with density, but estimating the magnitude of those economies is difficult. Some manufacturing firms cluster to reduce the costs of moving goods, but this force no longer appears to be important in driving urban success. Instead, modern cities are far more dependent on the role that density can play in speeding the flow of ideas. Finally, urban economics has some insights to offer related topics such as growth theory, national income accounts, public economics and housing prices.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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89.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Jose A. Scheinkman Princeton University - Department of Economics Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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26 Jul 00
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26 Jul 00
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40 (129,991)
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175
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Abstract:
We examine the relationship between urban characteristics in 1960 and urban growth (income and population) between 1960 and 1990. Our major findings are that income and population growth move together and both types of growth are (1) positively related to initial schooling, (2) negatively related to initial unemployment and (3) negatively related to the share of employment initially in manufacturing. These results are qualitatively unchanged if we examine cities (a smaller political unit) or SMSAs (a larger 'economic' unit). We also find that racial composition and segregation are basically uncorrelated with urban growth across all cities, but that in communities with large nonwhite communities segregation is positively correlated with white population growth. Government expenditures (except for sanitation) are uncorrelated with urban growth. Government debt is positively correlated with later growth.
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90.
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Bruce Sacerdote Dartmouth College - Department of Economics
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| Posted: |
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16 Oct 96
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Last Revised:
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09 May 00
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40 (129,991)
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55
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Crime rates are much higher in big cities than in either small cities or rural areas, and this situation has been relatively pervasive for several centuries. This paper attempts to explain this connection by using victimization data, evidence from the NLSY on criminal behavior and the Uniform Crime Reports. Higher pecuniary benefits for crime in large cities can explain approximately 27% of the effect for overall crime, though obviously much less of the urban- crime connection for non-pecuniary crimes such as rape or assault. Lower arrest probabilities, and lower probability of recognition, are a feature of urban life, but these factors seem to explain at most 20% of the urban crime effect. The remaining 45-60% of the effect can be related to observable characteristics of individuals and cities. The characteristics that seem most important are those that reflect tastes, social influences and family structure. Ultimately, we can say that the urban crime premium is associated with these characteristics, but we are left trying to explain why these characteristics are connected with urban living.
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91.
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Growth in Cities
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Hedi Kallal Salomon Smith Barney, Inc. Jose A. Scheinkman Princeton University - Department of Economics Andrei Shleifer Harvard University - Department of Economics
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Posted:
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03 Feb 01
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19 Nov 09
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38 (132,471) |
219
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Hedi Kallal Salomon Smith Barney, Inc. Jose A. Scheinkman Princeton University - Department of Economics Andrei Shleifer Harvard University - Department of Economics
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17 Nov 09
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19 Nov 09
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Assesses the theories of knowledge spillover and growth proposed by Romer, Porter, and Jacobs by focusing on the largest industries in 170 U.S. cities. While the theories of Romer and Porter both emphasize spillovers within an industry, Romer predicts that a local monopoly is better for growth as compared to Porter's prediction that local competition fosters growth. Jacobs takes an opposing approach, holding that knowledge transfers come from outside the core industry. Data used in the analysis were collected from the 1956 and 1987 editions of the County Business Patterns, which is produced by the U.S. Bureau of Census. For each of 170 cities considered in the analysis, only the top six industries in that city were analyzed. To determine the effect of externalities on growth, the examination looks at the same industries in different cities. In cities where an industry is overrepresented, those industries grow more slowly. This result supports Jacobs' theory. Further results show that faster growth occurred in cities where the firms were smaller than the average national size of such firms. The work of Jacobs and Porter gains support from this result. Additional support for Jacobs is shown by the finding that growth is faster in city-industries where the remainder of the city is less specialized. The results are consistent for manufacturing and nonmanufacturing industries, and whether the industry has a primarily local or global market. Overall, the greatest support is shown for the theory put forth by Jacobs, that major technological spillovers often occur between rather than within industries. (SRD)
County Business Patterns, U.S. Bureau of Census, Specialization, Market competition, Knowledge spillovers, Urban development, Cities, Firm growth, Firm size, Knowledge transfer, Market diversification, Localization
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Edward L. Glaeser Harvard University - John F. Kennedy School of Government, Department of Economics Hedi Kallal Salomon Smith Barney, Inc. Jose A. Scheinkman Princeton University - Department of Economics Andrei Shleifer Harvard University - Department of Economics
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| Posted: |
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03 Feb 01
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03 Feb 01
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38
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Abstract:
No abstract is available for this paper.
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92.
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Glenn David Ellison |