productivity and the other decreasing transportation costs, and in which agglomeration economies lead to persistence in urban …

. In these models there is an increasing returns effect that favors agglomeration, but also a crowding or market …

and policy analysis. A 'selection effect' means standard empirical measures overestimate agglomeration economies. A …

designed to attract firms to particular regions (place-based policies). I first propose a theory of the distribution of … heterogeneous firms in a variety of sectors across cities. Aggregate TFP and welfare depend on the extent of agglomeration …

magnify productivity. We show how our theory's predictions concerning a single core, aggregate to predictions over regional …

In recent empirical literature on spatial agglomeration, many papers find evidence consistent with location …-specific externalities of some sort. Our willingness to accept evidence of agglomeration economies depends on how well key estimation … problems have been addressed. Three issues are particularly troublesome for identifying agglomeration effects: unobserved …