This paper examines the effect of agglomeration economies on the sensitivity of employment location to tax differentials. In the presence of agglomeration economies, when a firm moves into a community attracted by a tax reduction, other firms may decide to follow, implying that agglomeration...

This paper analyzes how the dynamics of house prices are affected by the option to rebuild or enlarge existing dwellings. The nonlinear functional form for option value and zoning limits provides identification of changes in option value over the cycle. For homes with high development potential,...

We analyze land use regulations in cities with traffic congestion and production spillovers. Land is allocated between residential and industrial uses inside the city boundary or between urban and rural uses at the city boundary. The production is dispersed over the city, and people and firms...

This paper shows that a family of the Dixit–Stiglitz type of new economic geography models is capable of simulating the real-world tendency for agglomeration to the primate city. It is often observed that while regional populations were dispersed in early times, they have been increasingly...

The diffusion of knowledge generates positive externalities if knowledge flows increase the productivity of R&D by the recipients of these flows. We investigate the extent to which these spillovers depend on the similarity of research activities by the originator and recipient of the knowledge,...

We use the 1999–2009 Panel Survey of Income Dynamics to estimate household move probabilities as a function of, among other things, current housing equity. The lock-in effect supposes that mobility decreases with the mortgage loan-to-value ratio, particularly as equity becomes negative. We...

This paper evaluates the role of competition and input–output market access in shaping the geography of economic activity. In a first step, we develop a multi-region multi-industry economic geography model under Cournot competition, of which we estimate the parameter values from French data....

Despite widespread recognition that housing renovation is influenced by “neighborhood effects”, virtually all empirical studies have failed to identify a positive feedback effect between renovation activity and neighborhood quality. By explicitly modeling the spatial interdependence of...

Urban areas are characterized by dispersed employment patterns and mixed land use. Lucas and Rossi‐Hansberg (LRH) [Econometrica 70 (2002), 1445–1476] develop a model where the urban spatial structure is determined by the external benefits of agglomeration and the commuting costs for workers....

Historically, local governments in the United States have relied on the property tax as their main source of own-source revenues. With the recent collapse of housing prices and the resulting increase in foreclosures that followed the “Great Recession”, many observers have speculated that the...