Suburbs and Cities

Posted: 15 Nov 1996

See all articles by William N. Goetzmann

William N. Goetzmann

Yale School of Management - International Center for Finance; National Bureau of Economic Research (NBER)

Matthew I. Spiegel

Yale University - Yale School of Management, International Center for Finance

Susan M. Wachter

University of Pennsylvania - Wharton School, Department of Real Estate ; University of Pennsylvania - Finance Department

Date Written: January 1996

Abstract

This paper addresses the issue of how closely the fortunes of suburbs are tied to the fortunes of the central city. We use similarities in residential housing price dynamics as a measure of how closely the economies of cities and suburbs are related. We develop housing price indices for most of the zip codes in California, and use these in a clustering procedure to see whether cities and suburbs naturally aggregate together, or whether they move separately. We find that central cities tend to aggregate with their suburbs suggesting that the fortunes of the cities and suburbs are closely linked. We find evidence of a two-tiered structure to suburbs. While nearby suburbs continue to group with their metropolitan core, extended suburban economies comprised mostly of affluent neighborhoods, may be "drifting away" from the central cities.

JEL Classification: R21

Suggested Citation

Goetzmann, William N. and Spiegel, Matthew I. and Wachter, Susan M., Suburbs and Cities (January 1996). Available at SSRN: https://ssrn.com/abstract=9178

William N. Goetzmann (Contact Author)

Yale School of Management - International Center for Finance ( email )

165 Whitney Ave.
P.O. Box 208200
New Haven, CT 06520-8200
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203-432-5950 (Phone)
203-436-9252 (Fax)

HOME PAGE: http://viking.som.yale.edu

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Matthew I. Spiegel

Yale University - Yale School of Management, International Center for Finance ( email )

135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
United States
203-432-6017 (Phone)
203-432-8931 (Fax)

HOME PAGE: http://som.yale.edu/~spiegel

Susan M. Wachter

University of Pennsylvania - Wharton School, Department of Real Estate ( email )

The Wharton School
3620 Locust Walk
Philadelphia, PA 19104-6330
United States
215-898-6355 (Phone)

HOME PAGE: http://real.wharton.upenn.edu/~wachter/index.html

University of Pennsylvania - Finance Department ( email )

The Wharton School
3620 Locust Walk
Philadelphia, PA 19104
United States

HOME PAGE: http://real.wharton.upenn.edu/~wachter/index.html

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