UGBA 180 Lecture Notes - Lecture 3: Hyperloop, Memphis, Tennessee, Pier 1 Imports
Lecture 3: Understanding the Urban Landscape: Across Cities
Why Do Cities Exist?
●Less than 5% of the land area of the US is developed
○Largest 25 cities are home to 12% of the population but account for only 0.2% of
the land
○Mexico city covers less than 0.1% of mexico’s land area but it contains 10% of
the population
Urban Dynamics Across Cities
●Factors to consider
○Agglomeration economies
○Demographic changes
○Local public policy
Agglomeration Economies
●Agglomeration economies arise from positive externalities between firms or workers
●Having other firms or workers near you makes you more productive
Channels
●Why does distance matter?
○Intermediate input economies of scale
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Document Summary
Lecture 3: understanding the urban landscape: across cities. Less than 5% of the land area of the us is developed. Largest 25 cities are home to 12% of the population but account for only 0. 2% of the land. Mexico city covers less than 0. 1% of mexico"s land area but it contains 10% of the population. Agglomeration economies arise from positive externalities between firms or workers. Having other firms or workers near you makes you more productive. Co-location allows firms to share intermediate inputs. Face to face interactions cheaper in denser areas. Facilitates transfer of ideas and knowledge across and within industries. Gives rise to knowledge spillovers and innovation. Disproportionate share of patents originate in large cities. Quality of match between firms and workers matters. Expected match quality is higher in larger or thicker markets. A city"s fortunes can ride on the fortunes of a particular industry. > real estate industry is obsessed with jobs.