Empirical research on cities starts with a spatial equilibrium condition: workers and firms are assumed to be indifferent across space. This condition implies that research on cities is different from research on countries, and that work on places within countries needs to consider population,...

This paper proposes a simple theory of a system of cities that decomposes the determinants of the city size distribution into three main components: efficiency, amenities, and frictions. Higher efficiency and better amenities lead to larger cities, but also to greater frictions through...

This handbook chapter studies the theoretical micro-foundations of urban agglomeration economies. We distinguish three types of micro-foundations, based on sharing, matching, and learning mechanisms. For each of these three categories, we develop one or more core models in detail and discuss the...

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 concentration reflects natural advantages versus agglomeration forces is central...

In this paper I investigate the use of different search methods by unemployed youth. I present a job search model which shows that search method choices should be related to their costs and expected productivities, as well as other factors such as nonwage income and wage offer distributions. I...

The model of job search involves both employer matches and career matches and incorporates an asymmetry in the search technology. Workers may change employers without changing careers, but cannot search over possible lines of work while working for one employer. The optimal policy implies a...

Using a Cox proportional hazard model that allows for a flexible time dependence that can incorporate both seasonal and business cycle effects, we analyze the determinants of re-employment probabilities of young workers from 1978-1989. We find considerable changes in the chances of young workers...