This paper revisits a classical inquiry by addressing the question of localization and urbanization economies. We propose that specialization and diversity may offer externalities operating at different spatial scales. Using high-resolution geo-coded plant-level panel data for Swedish cities...

As a standard explanation for national price levels, the Balassa-Samuelson (BS) model presupposes a homogeneous domestic labor force and intersectoral labor mobility. We propose a contrasting theory of the “rich neighborhood effect” (RNE). It is a more general theory because it explicitly...

In this paper we aim to analyze the productivity spillovers of foreign affiliated and domestic firms in Turkish manufacturing industries. As a novelty inter-sectoral linkages are modeled through the use of spatial models. Our results indicate the existence of positive and significant...

As a standard explanation for national price levels, the Balassa-Samuelson (BS) effect presupposes a homogeneous domestic labor force and intersectoral labor mobility. We propose a contrasting theory of the rich neighborhood effect which allows for domestic labor force heterogeneity. The...

The neighborhood effect was used to analyze two problems of farm activity in Brazil. The first estimate a measure of total factor productivity for 550 homogeneous microregion, that is defined as a latent variable with the spatial trend propriety. The second analyze the occupation process in the...

A central puzzle in international finance is that real exchange rates are volatile and, in stark contradiction to effcient risk-sharing, negatively correlated with cross-country consumption ratios. This paper shows that incomplete asset markets and a low price elasticity of tradables can account...