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The Comparative Advantage of Cities
- Publication Year :
- 2014
-
Abstract
- What determines the distributions of skills, occupations, and industries across cities? We develop a theory to jointly address these fundamental questions about the spatial organization of economies. Our model incorporates a system of cities, their internal urban structures, and a high-dimensional theory of factor-driven comparative advantage. It predicts that larger cities will be skill-abundant and specialize in skill-intensive activities according to the monotone likelihood ratio property. We test the model using data on 270 US metropolitan areas, 3 to 9 educational categories, 22 occupations, and 21 manufacturing industries. The results provide support for our theory's predictions.
- Subjects :
- Economics and Econometrics
Property (philosophy)
Economies of agglomeration
Welfare economics
05 social sciences
Metropolitan area
jel:F14
jel:F11
Test (assessment)
0502 economics and business
Economics
Monotone likelihood ratio
jel:R13
Economic geography
jel:R12
050207 economics
Finance
Comparative advantage
Spatial organization
050205 econometrics
Subjects
Details
- Database :
- OpenAIRE
- Accession number :
- edsair.doi.dedup.....117ca152b6a4971c5b92b9d50d318eb9