Identifying Agglomeration Shadows: Long-run Evidence from Ancient Ports

68 Pages Posted: 12 Jul 2024

See all articles by Richard Hornbeck

Richard Hornbeck

University of Chicago - Booth School of Business

Guy Michaels

London School of Economics

Ferdinand Rauch

Heidelberg University - Alfred Weber Institute for Economics

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Date Written: July 11, 2024

Abstract

We examine “agglomeration shadows” that emerge around large cities, which discourage some economic activities in nearby areas. Identifying agglomeration shadows is complicated, however, by endogenous city formation and “wave interference” that we show in simulations. We use the locations of ancient ports near the Mediterranean, which seeded modern cities, to estimate agglomeration shadows cast on nearby areas. We find that empirically, as in the simulations, detectable agglomeration shadows emerge for large cities around ancient ports. These patterns extend to modern city locations more generally, and illustrate how encouraging growth in particular places can discourage growth of nearby areas.

JEL Classification: N9,R12

Suggested Citation

Hornbeck, Richard and Michaels, Guy and Rauch, Ferdinand, Identifying Agglomeration Shadows: Long-run Evidence from Ancient Ports (July 11, 2024). University of Chicago, Becker Friedman Institute for Economics Working Paper No. 2024-80, Available at SSRN: https://ssrn.com/abstract=4891930 or http://dx.doi.org/10.2139/ssrn.4891930

Richard Hornbeck (Contact Author)

University of Chicago - Booth School of Business ( email )

5807 South Woodlawn Avenue
Chicago, IL 60637
United States

Guy Michaels

London School of Economics ( email )

United Kingdom

Ferdinand Rauch

Heidelberg University - Alfred Weber Institute for Economics ( email )

Grabengasse 14
Heidelberg, D-69117
Germany

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