Title: Macroeconomic Implications of Agglomeration
Abstract: EconometricaVolume 82, Issue 2 p. 731-764 Macroeconomic Implications of Agglomeration Morris A. Davis, Morris A. Davis Dept. of Real Estate and Urban Land Economics, University of Wisconsin–Madison, Madison, WI 53706, U.S.A.; [email protected]Search for more papers by this authorJonas D. M. Fisher, Jonas D. M. Fisher Federal Reserve Bank of Chicago, Chicago, IL 60637, U.S.A.; [email protected]Search for more papers by this authorToni M. Whited, Toni M. Whited Simon Business School, University of Rochester, Rochester, NY 14627, U.S.A.; [email protected] We thank Rosella Argenziano, Roc Armenter, Marco Bassetto, V. V. Chari, Jonathan Heathcote, François Ortalo-Magné, Erwan Quintin, Sevi Rodriguez-Mora, José Víctor Ríos Rull, Marcelo Veracierto, Mark Wright, numerous seminar participants, the referees, and the editor for helpful comments. Yunjeen Kim provided outstanding research assistance. The views expressed herein are those of the authors and do not necessarily represent those of the Federal Reserve Bank of Chicago or the Federal Reserve System.Search for more papers by this author Morris A. Davis, Morris A. Davis Dept. of Real Estate and Urban Land Economics, University of Wisconsin–Madison, Madison, WI 53706, U.S.A.; [email protected]Search for more papers by this authorJonas D. M. Fisher, Jonas D. M. Fisher Federal Reserve Bank of Chicago, Chicago, IL 60637, U.S.A.; [email protected]Search for more papers by this authorToni M. Whited, Toni M. Whited Simon Business School, University of Rochester, Rochester, NY 14627, U.S.A.; [email protected] We thank Rosella Argenziano, Roc Armenter, Marco Bassetto, V. V. Chari, Jonathan Heathcote, François Ortalo-Magné, Erwan Quintin, Sevi Rodriguez-Mora, José Víctor Ríos Rull, Marcelo Veracierto, Mark Wright, numerous seminar participants, the referees, and the editor for helpful comments. Yunjeen Kim provided outstanding research assistance. The views expressed herein are those of the authors and do not necessarily represent those of the Federal Reserve Bank of Chicago or the Federal Reserve System.Search for more papers by this author First published: 01 April 2014 https://doi.org/10.3982/ECTA9029Citations: 45 AboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Abstract Cities exist because of the productivity gains that arise from clustering production and workers, a process called agglomeration. How important is agglomeration for aggregate growth? This paper constructs a dynamic stochastic general equilibrium model of cities and uses it to estimate the effect of local agglomeration on aggregate growth. We combine aggregate time-series and city-level panel data to estimate the model's parameters via generalized method of moments. The estimates imply a statistically and economically significant impact of local agglomeration on the growth rate of per capita consumption, raising it by about 10%. Citing Literature Volume82, Issue2March 2014Pages 731-764 RelatedInformation