London is (very) different – Europe edition. Chart from today's UK productivity plan. #summerbudget http://t.co/PbZqAdVvFe—
RBS Economics (@RBS_Economics) July 10, 2015
London is different
11 Jul 2015 Leave a comment
in urban economics Tags: agglomeration, British economy, London
The robots are coming, the robots are coming to property values
16 May 2015 Leave a comment
in applied price theory, economics of media and culture, entrepreneurship, industrial organisation, survivor principle, technological progress, transport economics, urban economics Tags: agglomeration, compensating differentials, creative destruction, driverless cars, drones, entrepreneurial alertness, land prices, land supply
A few years ago, Casey Mulligan wrote a fascinating little op-ed about the impact of drones on land prices and urban living.
As drones and driverless cars make it cheaper to move people around cities, the value of inner-city land will fall simply because their proximity to the action has diminished.
With drones and driverless cars, it will be easier to bring something in on the just-in-time basis rather than have it on hand as inventory or within walking distance because traffic congestion makes it too slow to call it up from the suburbs through the conventional commercial transport.
But we live in a world of trade-offs. More people may want to move into the city because it’s so much easier to move around and call things up by drone, driverless car and the share economy, so this may intensify agglomeration effects and increased land prices. Another big day out for the two handed economist.
Hsieh and Moretti on Allocations across Cities
23 Jan 2015 Leave a comment
in applied price theory, applied welfare economics, economics of regulation, geography, law and economics, politics - New Zealand, politics - USA, rentseeking, urban economics Tags: agglomeration, green rent seeking, land supply, zoning
the implied cost of housing restrictions across the whole U.S., and Chang and Enrico find that aggregate output is lower by about 10-14% because of them.
Last post on the NBER growth session. Chang-Tai Hsieh (Chicago) and Enrico Moretti (Berkeley) presented a paper on wage dispersion across cities in the U.S. Wage dispersion (New Yorkers earn more than people in Cleveland) either represents compensation for living costs (housing in New York is more expensive than in Cleveland), a real difference in productivity (New Yorkers are more productive than Clevelanders), or some combination of the two.
What Chang and Enrico find is that the increase in wage dispersion across cities in the U.S. over the last thirty-ish years is due almost entirely to rising house prices in six cities: NY, DC, Boston, San Fran, San Jose, and Seattle. Wages have gone up rapidly in those cities, but that is basically just compensating their citizens for the higher costs of living.
Now, given the costs of living, the allocation of population across cities in the U.S. is…
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Utopia, you are standing in it! 
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