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The standard revealed-preference estimate of a city's quality of life is proportional to that city's cost-of-living relative to its wage-level. Adjusting estimates to account for federal taxes, non-housing costs, and non-labor income produces more plausible quality-of-life estimates than in the...
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estimates how city size affects worker productivity (agglomeration benefits) in Germany, based on individual-level wage data … elasticity for agglomeration benefits is around 0.02, implying that comparable workers in Hamburg (3 million residents) are about … 6% more productive than in Recklinghausen (150 000). But agglomeration benefits are, on average, offset by higher prices …
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