Essays in Urban Economics

Abstract

In this set of essays, I grapple with issues related to the core questions of urban economics. Why are people so heavily clustered in urban areas? Why do some cities grow while others decline? What explains where people live within urban areas? My first essay focuses on understanding patterns of racial segregation within metro areas. One factor that has long been hypothesized to contribute to this divide, but has proven difficult to test empirically, is that local zoning regulations have an exclusionary impact on minority residents in some neighborhoods. I focus on variation in block-level racial composition within narrow bands around zone borders within jurisdictions. My results imply a large role for local zoning regulation, particularly the permitting of dense multi-family structures, in explaining disparate racial location patterns. The second essay returns to core issues of agglomeration and the role of cities. The fact that wages tend to be higher in cities, and that this premium grows with density, has been seen as strong evidence for urban agglomeration forces enhancing productivity. In modern data this density premium seems only to exist in areas with above average levels of human capital. Agglomeration models emphasizing learning and knowledge spillovers between workers in close proximity seem most compatible with the data. Finally, I investigate the impact of local governance structure on urban growth over the last 40 years. Some economists have touted the virtues of competition between fragmented local governments in efficient provision of local public goods, while regionalists have pointed to the need to coordinate planning and infrastructure across jurisdictions, and warned of the impacts of fractionalization on segregation and sprawl. While cities with regionalized governments have grown more rapidly, a small set of strong historical correlates with local government density can account for this. Impacts on segregation are more robust.