Agglomeration economies and urban capital markets

Article Abstract:

A model of urban capital markets where commercial credit is distributed among riskier investment projects in cities of different sizes demonstrates that the second best use of immobile and specialized assets in large cities are more valuable than in small cities, suggesting that the second best use is more valuable where a greater number of possible uses exist such as in large cities. The greater number of possible ways in larger cities to use capital from failed projects indicates that capital assets in those cities are more likely to have higher salvage values. Agglomeration economies occur because the expected second best use of immobile assets are more valuable in larger cities, meaning that resource productivity is directly proportional to city size in two ways: better matched assets, and reduced risk.

Research, Capital market, Capital markets, Commercial credit

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The determinants of agglomeration

Article Abstract:

This article examines agglomeration economies for manufacturing industries throughout the United States. The authors, analyzing knowledge spillovers, labor market pooling, input sharing, product shipping costs, and natural advantage at the zipcode, county, and state levels, conclude that labor pooling has the strongest effect at all levels, spillovers only positively affect agglomeration at the zipcode level, while all other proxies positively affect agglomeration at the state level.

United States, Economics, Research and Development in the Social Sciences and Humanities, Analysis, Manufacturing industry, Manufacturing industries, Economic aspects, Metropolitan areas

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Knowledge barter in cities

Article Abstract:

A study models various endogenous knowledge transfers and shows that endogenous knowledge barter is fundamentally better than exogenous spillovers. However, the sustainability of knowledge barter depends crucially on city size, suggesting that the knowledge-agglomeration is non-monotonic.

Knowledge management

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