Results

CEP discussion paper

Quantitative urban economics

This paper reviews recent quantitative urban models. These models are sufficiently rich to capture observed features of the data, such as many asymmetric locations and a rich geography of the transport network. Yet these...Read more...

CEP discussion paper

Spatial economics

This paper reviews recent research in spatial economics. The field of spatial economics is concerned with the determinants and effects of the location of economic activity in geographic space. It analyses how geographica...Read more...

Journal article

Proceedings of the National Academy of Sciences of the United States of America:

How working from home reshapes cities

In recent decades, economic activity has become increasingly concentrated in major global metropolises. Yet, the rise of working from home threatens this dominance of cities. Using multiple high-frequency datasets on spe...Read more...

CEP discussion paper

Multipliers from a major public sector relocation: The BBC moves to Salford

This paper considers the impact of a major public sector relocation: the British Broadcasting Corporation's partial move from London to Salford, Greater Manchester starting in 2011. We identify effects of the move using ...Read more...

Journal article

Journal of Urban Economics: Forthcoming

Cities and the sea level

Construction on low elevation coastal zones is risky for both residents and taxpayers who bail them out. To investigate this construction, we analyze spatially disaggregated data covering the entire US Atlantic and Gulf ...Read more...

CEP Insights

Insights: condensed

The Insights series is an introduction to the work of the Centre for Economic Performance (CEP). Each Insight highlights the contribution of CEP researchers to both academic understanding and policymaking in one area of ...Read more...

CEP discussion paper

Urban-biased structural change

Using firm-level data from France, we document that the shift of economic activity from manufacturing to services over the last few decades has been urban-biased: structural change has been more pronounced in areas with ...Read more...

Journal article

Journal of Environmental Economics and Management : Forthcoming

Dirty density: air quality and the density of American cities

We study the effect of urban density on the exposure of city dwellers to air pollution using data from the United States urban system. Exploiting geological features to instrument for density, we find an economically and...Read more...

Journal article

Urban Studies:

Progressive cities: urban-rural polarisation of social values and economic development around the world

In contrast to the conservative values of rural populations, cities are often seen as bulwarks of more tolerant, liberal and progressive values. This urban-rural divide in values has become one of the major fault lines i...Read more...

Journal article

Regional Studies: Forthcoming

Level best? The levelling up agenda and UK regional inequality

'Levelling up' - a policy agenda focused on reducing regional inequalities - has become the new mantra in British politics. This paper critiques the policy programme from its emergence in 2019 to the publication of the 2...Read more...

CEP discussion paper

The economics of cities: from theory to data

Economic activity is highly unevenly distributed within cities, as reflected in the concentration of economic functions in specific locations, such as finance in the Square Mile in London. The extent to which this concen...Read more...

Journal article

Environment and Planning B: Urban Analytics and City Science : Forthcoming

Modeling clusters from the ground up: a web data approach

This paper proposes a new methodological framework to identify economic clusters over space and time. We employ a unique open source dataset of geolocated and archived business webpages and interrogate them using Natural...Read more...

Journal article

Economic Geography:

Creative clusters and creative multipliers: evidence from UK cities

Economic geographers have paid much attention to the cultural and creative industries, both for their propensity to cluster in urban settings, and their potential to drive urban economic development. However, evidence on...Read more...

CEP discussion paper

The research university, invention and industry: evidence from German history

We examine the role of universities in knowledge production and industrial change using historical evidence. Political shocks led to a profound pro-science shift in German universities around 1800. To study the consequen...Read more...

Chapter

The Urban Economics of Superdiversity

in The Oxford Handbook of Superdiversity

This chapter examines the economic impacts of superdiversity in theory and practice, drawing on the experience of the United Kingdom in the early 2000s. Superdiversity has a largely urban footprint, reflecting the afford...Read more...

Journal article

Urban Studies: Forthcoming

The city and the virus

Cities around the world are the epicentres of the coronavirus pandemic: both in the first wave, as the disease spread from East Asia, and now, as many countries enter a third wave of infections. These spatial patterns ar...Read more...

Journal article

Land Economics:

Valuing the environmental benefits of canals and canal restoration using house prices

This article values the environmental benefits of historic, navigable canals using property values. We improve on standard methods by controlling for microgeographic fixed effects and applying a difference-in-differences...Read more...

CEP discussion paper

Pandemic shock and economic divergence: political economy before and after the black death

We document how the Black Death activated politics and led to economic divergence within Europe. Before the pandemic, economic development was similar in Eastern and Western German cities despite greater political fragme...Read more...

CentrePiece article

Rising sea levels and the future of coastal cities

Despite the higher susceptibility to floods and a growing climate crisis, more than 10% of the world's population lives in low-elevation coastal zones - and that share is increasing. Guy Michaels and colleagues present a...Read more...

CEP Insights

Cities and regions

Economic prosperity is very unevenly distributed across space. What causes some places to be richer and some poorer? Why do these spatial disparities matter - and what can policy do to reduce them? Economists studying ur...Read more...

Blog

VoxEU:

Consumer city: evidence from smartphone data

Traditional theories emphasise production decisions and the commuting costs of workers in shaping the spatial concentration of economic activity in cities. However, much of urban travel is related to consumption of non-t...Read more...

External publication

Pancakes to pyramids: city form to promote sustainable growth (English)

Towns and cities are economic and social microcosms in which large numbers of people and firms interact. These interactions largely shape how a city looks, how it functions, and how it grows. But how exactly does this ma...Read more...

CEP discussion paper

Cities and the sea level

Construction on low elevation coastal zones is risky for both residents and taxpayers who bail them out, especially when sea levels are rising. We study this construction using spatially disaggregated data on the US Atla...Read more...

CentrePiece article

Lockdown and the social life of big cities

The effects of Covid-19 on the social lives of city dwellers - being able to go to the pub, restaurants and theatre - may be more relevant for the future of cities than its impact on work. That's the implication of a tho...Read more...

Blog

LSE Business Review:

Lockdown shows us it is not work that attracts us to big cities - but the social life

Covid-19's effect on the social lives of city dwellers - being able to meet at the pub, restaurants or theatre - may be more relevant for the future of cities than its impact on work, write Gabriel Ahlfeldt, Fabian Bald,...Read more...

CentrePiece article

In brief... Economics of skyscrapers

Many tall buildings appear to be out of scale given contemporary perceptions. But according to Gabriel Ahlfeldt and Jason Barr, the vast majority have a solid economic case for their construction....Read more...

CentrePiece article

In brief... City of dreams no more: Covid-19 in urban India

The pandemic has decimated livelihoods in urban India and created a new underclass of workers who are being pushed into poverty. A CEP report by Shania Bhalotia, Swati Dhingra and Fjolla Kondirolli calls for a national w...Read more...

CEP discussion paper

Place-based policies and spatial disparities across European cities

Spatial disparities in income levels and worklessness in the European Union are profound, persistent and may be widening. We describe disparities across metropolitan regions and discuss theories and empirical evidence th...Read more...

CEP discussion paper

Prime locations

We harness big data to detect prime locations - large clusters of knowledge-based tradable services - in 125 global cities and track changes in the within-city geography of prime service jobs over a century. Historically...Read more...

CEP Covid-19 analysis

City of dreams no more: the impact of Covid-19 on urban workers in India

Many developing economies have large informal sectors and growing urban youth populations, who lack basic social protections at work. The CEP surveyed 8,500 workers aged 18 to 40 in urban India to understand their experi...Read more...

CentrePiece article

In brief... Swings and silicon roundabouts: does cluster policy work?

Despite scepticism among researchers, policies to promote geographical clusters of firms in the same sector remain popular. Max Nathan evaluates a flagship programme set up a decade ago to accelerate the growth of Tech C...Read more...

CentrePiece article

People, places and politics: the challenge of 'levelling up' the UK

As has been much discussed since the election, economic performance varies widely among the towns, cities and regions of the UK. Henry Overman argues that policies to address these spatial disparities should be judged on...Read more...

Journal article

Regional Studies:

Creative differences? Measuring creative economy employment in the United States and the UK

This paper compares the creative economies of the US and the UK regions and nations using high-quality administrative microdata spanning the period 2011–13. The creative industries are highly urbanized in both countries....Read more...

CEP election analysis

People, places and politics

Economic performance varies widely between the towns, cities and regions of the UK. On some measures, this variation has widened since the financial crisis. These disparities have already proved to be a key theme in the ...Read more...

CEP discussion paper

Does light touch cluster policy work? Evaluating the tech city programme

Despite academic scepticism, cluster policies remain popular with policymakers. This paper evaluates the causal impact of a flagship UK technology cluster programme. I build a simple framework and identify effects using ...Read more...

Journal article

Journal of Urban Economics:

Measuring urban economic density

At the heart of urban economics are agglomeration economies, which drive the existence and extent of cities. This paper estimates urban agglomeration effects, exploring simple and very nuanced measures of economic densit...Read more...

CentrePiece article

Sustainable growth in the UK

Anna Valero and colleagues urge the UK government to put action on climate change and sustainability at the heart of its growth strategy....Read more...

CentrePiece article

The making of the modern metropolis: evidence from London

Stephen Redding and colleagues examine how the introduction of steam railways shaped the emerging metropolitan area of London....Read more...

CentrePiece article

In brief... What the Berlin Wall can teach us about urban development

Award-winning CEP research considers what can be learned from the division and reunification of Berlin....Read more...

CEP industrial strategy paper

Sustainable growth in the UK: seizing opportunities from technological change and the transition to a low-carbon economy

An overarching strategy for sustainable growth is required to address the dual challenges of restoring productivity growth and managing a transition to a low-carbon economy – priorities in both the UK and other G20 count...Read more...

Journal article

Review of Economics and Statistics:

Tall buildings and land values: Height and construction cost elasticities in Chicago, 1870-2010

Despite unprecedented vertical growth in large cities, the economics of skyscrapers remain understudied. We combine data on tall buildings with a panel of land prices covering 140 years to analyze the determinants of urb...Read more...

CEP discussion paper

Incubators, accelerators and regional economic development

A growing wave of co-location programmes promises to boost growth for young firms. Despite great public and policy interest we have little idea whether such programmes are effective. This paper categorises accelerators a...Read more...

CEP discussion paper

Measuring urban economic density

At the heart of urban economics are agglomeration economies, which drive the existence and extent of cities and are also central to structural transformation and the urbanization process. This paper evaluates the use of ...Read more...

CEP report

Urban Capacity and Economic Output

This report was commissioned by the National Infrastructure Commission as part of the evidence base for the National Infrastructure Assessment. The views expressed and recommendations set out in this report are the autho...Read more...

Journal article

Journal of Economic Geography:

Who gets the urban surplus?

High productivity in cities creates an economic surplus relative to other areas. How is this divided between workers and landowners? Simple models with homogenous labour suggest that it accrues largely-or entirely-in the...Read more...

CEP discussion paper

Does gentrification displace poor households? An 'identification-via-interaction' approach

My theoretical model motivates an ‘identification-via-interaction’ (IvI) approach that separates the causal impact of gentrification on poor exits from endogenous channels. In the empirical analysis, I create a measure o...Read more...

Journal article

Annual Review of Economics:

Quantitative spatial economics

The observed uneven distribution of economic activity across space is influenced by variation in exogenous geographical characteristics and endogenous interactions between agents in goods and factor markets. Until the pa...Read more...

CEP election analysis

The UK's Regional Divide: Can Policy Make a Difference

There are large variations in economic performance across the cities and regions of the UK. There is a broad North-South pattern to these disparities. But there is also substantial variation within those broad areas: som...Read more...

Journal article

Journal of Economic Geography:

Agglomeration externalities and urban growth controls

How can land use policy enhance the exploitation of external urban agglomeration economies? In a system of heterogeneous cities, we show that the second-best land use policy constrains city creation, while subsidizing (t...Read more...

Journal article

Environment and Planning A:

Ethnic diversity and business performance: Which firms? Which cities?

A growing literature examines how ethnic diversity influences economic outcomes in cities and inside firms. However, firm–city interactions remain more or less unexplored. Ethnic diversity may help firm performance by in...Read more...

CEP discussion paper

Quantitative spatial economics

The observed uneven distribution of economic activity across space is influenced by variation in exogenous geographical characteristics and endogenous interactions between agents in goods and factor markets. Until recent...Read more...

CentrePiece article

In brief... Investing in roads

Between 1990 and 2010, China constructed an extensive modern road network, including a national system of limited access highways. Vernon Henderson and colleagues investigate the impact on the growth of Chinese cities an...Read more...

SERC/Urban and Spatial Programme Discussion Paper

What Makes Cities More Productive? Agglomeration Economies and the Role of Urban Governance: Evidence from 5 OECD Countries

This paper estimates agglomeration benefits across five OECD countries, and represents the first empirical analysis that combines evidence on agglomeration benefits and the productivity impact of metropolitan governance ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Spillovers from Immigrant Diversity in Cities

Using comprehensive longitudinal matched employer-employee data for the U.S.,this paper provides new evidence on the relationship between productivity and immigration-spawned urban diversity. Existing empirical work has ...Read more...

CEP election analysis

#ElectionEconomics: The Research Evidence on Key Issues for Voters in the 2015 UK General Election

Please see the CEP #ElectionEconomics report(Paper 1)and the Executive Summary (Paper 2) that cover all the election 2015 briefings, discussing the research evidence on 15 of the UK's key policy battlegrounds: immigratio...Read more...

CEP election analysis

The Economic Performance of UK Cities: Can Urban and Regional Policy Make a Difference to the North-South Divide

There are large variations in economic performance across UK cities and on some measures, they have widened since the global financial crisis. All main parties promise action to reduce them, but there is little differenc...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Economic Value of Local Social Networks

The idea that local social capital yields economic benefits is fundamental to theories of agglomeration, and central to claims about the virtues of cities. However, this claim has not been evaluated using methods that pe...Read more...

CEP discussion paper

City of dreams

Higher ability workers benefit more from bigger cities while housing costs there are higher for everyone, and yet there is little sorting on ability. A possible explanation is that young individuals have an imperfect ass...Read more...

Book

Urban Economics and Urban Policy
Challenging Conventional Policy Wisdom Hardcover

In this bold, exciting and readable volume, Paul Cheshire, Max Nathan and Henry Overman illustrate the insights that recent economic research brings to our understanding of cities, and the lessons for urban policy-making...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Do Inventors Talk to Strangers? On Proximity and Collaborative Knowledge Creation

This paper investigates how physical, organisational, institutional, cognitive, social, and ethnic proximities between inventors shape their collaboration decisions. Using a new panel of UK inventors and a novel identifi...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Immigrant Diversity and Economic Development in Cities: A Critical Review

This paper reviews a growing literature investigating how ‘immigrant’ diversity relates to urban economic performance. As distinct from the labor-supply focus of much of the economics of immigration, this paper reviews w...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Here Be Startups: Exploring a young digital cluster in Inner East London

The digital industries cluster known as 'Silicon Roundabout' has been quietly growing in East London since the 1990s. Now rebranded 'Tech City', it is now the focus of huge public and government attention. National and l...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Cultural Diversity, Cities and Innovation: firm Effects or City Effects?

Growing cultural diversity is seen as important for innovation. Research has focused on two potential mechanisms: a firm effect, with diversity at the firm level improving knowledge sourcing or ideas generation, and a ci...Read more...

CentrePiece article

The economic future of British cities

Henry Overman surveys the evidence on potentially effective responses to the recession and longer-term structural change....Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Urban Wage Growth Premium: Sorting or Learning?

This paper is concerned with the urban wage premium and addresses two central issues about which the field has not yet reached a consensus. First, the extent to which sorting of high ability individuals into urban areas ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

How Far Do England’s Second-Order Cities Emulate London as Human-Capital ‘Escalators’?

In the urban resurgence accompanying the growth of the knowledge economy, second-order cities appear to be losing out to the principal city, especially where the latter is much larger and benefits from substantially grea...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Top Team Demographics, Innovation and Business Performance: Findings from English Firms and Cities 2008-9

High levels of net migration to the UK have contributed to growing cultural diversity, and researchers are turning their attention to the long-term effects of diversity on productivity. Yet little is known about these is...Read more...

CEP discussion paper

CEO Incentive Contracts in China: Why Does City Location Matter?

CEO incentive contracts are commonplace in China but their incidence varies significantly across Chinese cities. We show that city and provincial policy experiments help explain this variance. We examine the role of two ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Economics of Density: Evidence from the Berlin Wall

This paper develops a quantitative model of city structure to separate agglomeration forces, dispersion forces and fundamentals as determinants of location choices. The model remains tractable and amenable to empirical a...Read more...

CEP discussion paper

The Economics of Density: Evidence from the Berlin Wall

This paper develops a quantitative model of city structure to separate agglomeration forces, dispersion forces and fundamentals as determinants of location choices. The model remains tractable and amenable to empirical a...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Agglomeration Externalities and Urban Growth Controls

Should constraints on urban expansion be relaxed because of external agglomeration economies? In a system of heterogeneous cities, we demonstrate that second-best land use policy consists of a tax on city creation and a ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Ethnic Inventors, Diversity and Innovation in the UK: Evidence from Patents Microdata

Ethnic inventors play important roles in US innovation systems, especially in high-tech regions like Silicon Valley. Do ‘ethnicity-innovation’ channels exist elsewhere? This paper investigates, using a new panel of UK pa...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Does Cultural Diversity Help Innovation in Cities: Evidence from London Firms

London is one of the world’s major cities, and one of its most diverse. London’s cultural diversity is widely seen as a social asset, but there is little hard evidence on its importance for the city’s businesses. Theory ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Economics of Super-Diversity: Findings from British Cities, 2001-2006

British cities have a surprisingly long history of cultural diversity. Recently they have become significantly more multicultural, with ‘super-diversity’ emerging in many urban neighbourhoods. Public interest in these ch...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Long Term Impacts of Migration in British Cities: Diversity, Wages, Employment and Prices

British cities are becoming more culturally diverse, with migration a main driver. Is this growing diversity good for urban economies? This paper explores, using a new 16-year panel of UK cities. Over time, net migration...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Impact of Aging and Technological Relatedness on Agglomeration Externalities: A Survival Analysis

We study localization, urbanization, and Jacobs’ externality effects on plant survival in Sweden (1970-2004). We focus on two questions: (1) do agglomeration externalities change with the age of plants? (2) using new inf...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Fluctuating Record of Economic Regeneration in England's Second-Order City Regions, 1984-2007

This study examines how far and in what way ‘Our cities are back’, as claimed by England’s Core Cities Group. It focuses on 1984-2007 employment changes for the eight Core Cities and their city regions: Birmingham, Brist...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Productivity Advantages of Large Cities: Distinguishing Agglomeration from Firm Selection

Firms are more productive on average in larger cities. Two explanations have been offered: agglomeration economies (larger cities promote interactions that increase productivity) and firm selection (larger cities toughen...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Urban Growth Drivers in a Europe of Sticky People and Implicit Boundaries

We investigate urban GDP pc growth across the EU12 using data for functionally defined cities - rather than administrative regions. We test hypotheses on the role of human capital, EU integration and fragmentation of urb...Read more...

CEP discussion paper

Zipf's Law for Cities: A Cross Country Investigation

This paper assesses the empirical validity of Zipf¿s Law for cities, using new data on 73 countries and two estimation methods ¿ OLS and the Hill estimator. With either estimator, we reject Zipf¿s Law far more often than...Read more...

CEP discussion paper

Spatial Disparities in Developing Countries: Cities, Regions and International Trade

Spatial inequality in developing countries is due to the natural advantages of some regions relative to others and to the presence of agglomeration forces, leading to clustering of activity. This paper reviews and develo...Read more...

CEP discussion paper

Communication Externalities in Cities

To identify communication externalities in French cities, we exploit a unique survey recording workplace communication of individual workers. Our hypothesis is that in larger and/or more educated cities, workers should c...Read more...

CEP discussion paper

From Sectoral To Functional Urban Specialisation

We document and then develop a model explaining and relating changes in firms' organisation and in urban structure. Sharing of business services by headquarters and of sector-specific intermediates by production plants ...Read more...

CEP discussion paper

Nursery Cities: Urban Diversity, Process Innovation and the Life-Cycle of Products

A simple model of process innovation is proposed, where firms learn about their ideal production process by making prototypes. We build around this a dynamic general equilibrium model, and derive conditions under which d...Read more...