Real Estate Papers

Document Type

Journal Article

Date of this Version

6-2014

Publication Source

Journal of Political Economy

Volume

122

Issue

3

Start Page

507

Last Page

553

DOI

10.1086/675534

Abstract

Large cities produce more output per capita than small cities. This higher productivity may occur because more talented individuals sort into large cities, because large cities select more productive entrepreneurs and firms, or because of agglomeration economies. We develop a model of systems of cities that combines all three elements and suggests interesting complementarities between them. The model can replicate stylized facts about sorting, agglomeration, and selection in cities. It also generates Zipf’s law for cities under empirically plausible parameter values. Finally, it provides a useful framework within which to reinterpret extant empirical evidence.

Keywords

sorting, selection, agglomeration, urban premium, city size, Zipf's law

Included in

Real Estate Commons

Share

COinS
 

Date Posted: 27 November 2017

This document has been peer reviewed.