Social Capital and Urban Growth

47 Pages Posted: 15 Nov 2008

See all articles by Edward L. Glaeser

Edward L. Glaeser

Harvard University - Department of Economics; Brookings Institution; National Bureau of Economic Research (NBER)

Charles Redlick

Harvard University - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: November 10, 2008

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.

Suggested Citation

Glaeser, Edward L. and Redlick, Charles, Social Capital and Urban Growth (November 10, 2008). Harvard Institute of Economic Research, Research Paper Series No. 2167. Available at SSRN: https://ssrn.com/abstract=1299086 or http://dx.doi.org/10.2139/ssrn.1299086

Edward L. Glaeser (Contact Author)

Harvard University - Department of Economics ( email )

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Brookings Institution

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National Bureau of Economic Research (NBER)

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Charles Redlick

Harvard University - Department of Economics ( email )

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