the impact of rent control on tenure discounts and residential mobility it is widely believed that rent control leads to a decline in the quality of rental housing this study examines the effect of rent control on the quality of rental housing in new york city quality change is linked to the suppression of rent below

cost reduction competition and industry performance in many markets firms compete over time by expending resources with the purpose of reducing their costs sometimes the cost reducing investments operate directly on costs in many instances they take the form of developing new products that deliver what customers need more cheaply therefore product development can have the same ultimate effect as direct cost reduction in fact if one thinks of the product as the services it delivers to the customer in the way that lancaster pioneered then product development often is just cost reduction

on the demise of pigovian economics much has been written on the emergence of the keynesian and hicksian research programs in the 1930s yet the demise of the marshallian research program to the extent that it was preserved extended and or amended by pigou has attracted little attention as a result arthur cecil pigou who contributed extensively to the theories of welfare economics 58 54 and unemployment 57 56 53 48 47 is seldom credited with more than discovering the divergence between social and private costs and developing such concepts as the pigovian tax or the pigou effect a broader more encompassing view of pigovian economics deserves our attention on at least two grounds first recent literature argues that modern welfare economics is no more scientific than the pigovian analysis it meant to replace 59 16 on methodological grounds therefore the advantages of modern welfare economics over its pigovian counterpart are not obvious pigovian welfare analysis however does possess a nontrivial welfare criterion2 which deals with issues concerning both equity and efficiency 3 pigou s welfare economics therefore can be found relevant to the growing literature on social choice inequality and income distribution 70 the second basis for continued interest in pigou s economic analysis is his extensive treatment of unemployment which has received much less attention than his welfare writings perhaps because it is befogged by many undeserving myths this work however is important for macro

immigration and house prices in the uk this article studies the effect of immigration on house prices in the uk it finds that immigration has a negative effect on house prices and presents evidence that this negative effect is due to the mobility response of the native population natives respond to immigration by moving to different areas and those who leave are at the top of the wage distribution this generates a negative income effect on housing demand and pushes down house prices the negative effect of immigration on house prices is driven by local areas where immigrants have lower education

the effect of immigration along the distribution of wages this paper analyses the effect immigration has on wages of native workers unlike most previous work we estimate wage effects along the distribution of wages we derive a flexible empirical strategy that does not rely on pre allocating immigrants to particular skill groups in our empirical analysis we demonstrate that immigrants downgrade considerably upon arrival as for the effects on native wages we find that immigration depresses wages below the 20th percentile of the wage distribution but leads to slight wage increases in the upper part of the wage distribution the overall wage effect of immigration is slightly positive the positive wage effects we find are although modest too large to be explained by an immigration surplus we suggest alternative explanations based on the idea that immigrants are paid less than the value of what they contribute to production generating therefore a surplus and we assess the magnitude of these effects

reap what you sow agricultural technology urbanization and structural change abstract this paper studies how productivity enhancing agricultural technology affects urbanization by provoking structural change we investigate these issues using a natural experiment in the united states the results show that technologies which improve crop productivity lead to a less urbanized economy as economic activity relocates from manufacturing and services towards agriculture the effects are highly persistent and are driven by the technology increasing agricultural labor demand our findings highlight the potentially unintended disruptive force of innovative technologies

amenity values versus land constraints the spatial effects of natural landscape features on housing values when local amenities are tied to natural land use features that cannot be developed for physical or regulatory reasons the corresponding implicit price estimates from a hedonic housing model may reflect local supply constraints and confound estimation of natural amenity values using a spatial simultaneous equations model of housing values and migration we examine whether local supply constraints from natural or preserved features have influenced the housing market results indicate that constraints associated with the presence of water bodies and some types of open space preservation have contributed to higher housing prices offsetting local demand for these natural amenities jel c31 r23

the effect of land use regulation on housing and land prices abstract this paper investigates the effects of land use regulation restrictiveness on house and vacant land prices in contrast to prior studies the index of restrictiveness is treated as an endogenous variable and estimated effects are allowed to vary by market setting using data on more than 100 florida cities greater regulation restrictiveness is found to increase house price and decrease land price evidence is also provided showing that more restrictiveness increases the size of newly constructed homes

the labor market impact of immigration a quasi experiment exploiting immigrant location rules in germany with the fall of the berlin wall ethnic germans living in eastern europe and the former soviet union were given the opportunity to migrate to germany within 15 years 2 8 million individuals had done so upon arrival these immigrants were exogenously allocated to different regions to ensure an even distribution across the country their inflow can therefore be seen as a quasi experiment of immigration i analyze the effect of these inflows on skill specific employment rates and wages the results indicate a displacement effect of 3 1 unemployed workers for every 10 immigrants that find a job but no effect on relative wages

the impact of supply constraints on house prices in england we test the theoretical prediction that house prices respond more strongly to changes in local earnings in places with tight supply constraints using a unique panel dataset of 353 local planning authorities in england between 1974 and 2008 exploiting exogenous variation from a policy reform vote shares and historical density to identify the endogenous constraints measures we find that regulatory constraints have a substantive positive impact on the house price earnings elasticity the effect of constraints due to scarcity of developable land is largely confined to highly urbanised areas and uneven topography has a quantitatively less meaningful impact

antitrust for high technology industries assessing research joint ventures and mergers the purpose of this paper is to analyze if and how the standard methodology of antitrust analysis should be modified to reflect the importance of r and d and innovation as competitive forces and engines of economic progress focus is on such r and d intensive business combinations as research joint ventures rjvs and horizontal mergers in high technology industries the authors do not propose a complete set of guidelines for the assessment of such combinations they present an economic model of rjvs and high technology mergers that might serve as an analytical underpinning for such guidelines one conclusion of the analysis is that rjvs ought to be accorded special treatment under the antitrust laws this special treatment should entail an explicit recognition that rjvs will be scrutinized under the rule of reason according to guidelines specific to this purpose

a patent system for both diffusion and exclusion public policy analysis of optimal patent regimes is often framed as a tradeoff between static and dynamic efficiency in this analytical framework weak patent protection and strict antitrust policy are taken to be directed toward static concerns while protection of intellectual property through strong patent laws is taken as a reflection of broader social concerns for long run growth and technological progress this characterization has some truth but the magnitude of the conflict between static and dynamic efficiency can easily be exaggerated in this article i want to argue that weak patent protection need not be inimical to economic growth and conversely that strong patent protection need not be an enemy of diffusion appropriately structured patent law and antitrust rules can together ensure incentives for r d and also induce cooperation among firms in diffusing r d results through licensing and other means at the same time cooperation among firms at the r d stage can counterbalance weak patent protection by internalizing spillovers from ongoing r d programs and such cooperation may also produce additional spillovers from the existing knowledge

economic growth in a cross section of cities abstract we examine the relationship between urban characteristics in 1960 and urban growth between 1960 and 1990 income and population growth move together and both types of growth are 1 positively related to initial schooling 2 negatively related to initial unemployment and 3 negatively related to the initial share of employment in manufacturing racial composition and segregation are uncorrelated with urban growth across all cities but in cities with large nonwhite communities segregation is positively correlated with population growth government expenditures except for sanitation are uncorrelated with growth government debt is positively correlated with later growth

mortgage supply and housing rents we show that a contraction of mortgage supply after the great recession has increased housing rents our empirical strategy exploits heterogeneity in msas exposure to regulatory shocks experienced by lenders over the 2010 2014 period tighter lending standards have increased demand for rental housing and have led to higher rents depressed homeownership rates and an increase in rental supply absent the credit supply contraction annual rent growth would have been 2 1 percentage points lower over 2010 2014 in msas where lending standards rose from their 2008 levels

effects of immigration on house prices in canada from the turn of the present century until late 2008 house prices in some developed countries including canada rose sharply compared to the increases in their per capita incomes some in the public circles of these countries argue that immigration fueled this rise each year canada admits about 225 000 immigrants but information on the effect of immigration on house prices in this country is lacking our extensive econometric analysis based on panel data at census division levels obtained from the 1996 2001 and 2006 population censuses indicates a statistically significant but small effect of immigration on prices of privately owned dwellings in canada an out migration of the native born from the areas where new immigrants settle or an increased supply of housing due to expectations of higher demand in those areas may have caused this result

public conservation land and employment growth in the northern forest region we quantify the effect that public conservation lands have on employment growth in the northern forest region of the united states a model of simultaneous employment and net migration growth is estimated with data on non metropolitan counties from 1990 to 1997 exogenous variables include the 1990 share of the land base in public conservation uses we find that net migration rates were higher in counties with more conservation lands but the effects are relatively small no significant effect on employment growth is detected as well variables measuring changes in public timber harvests have no effect on employment growth

immigration and house prices under various labour market structures in england and wales this article estimates the impact of immigration on local house prices under various local labour market structures in england and wales typically for the nation as a whole newly arriving immigr

rental housing markets the incidence and duration of vacancy and the natural vacancy rate abstract new intermetropolitan and time series data from the bls are used to derive and model the incidence and duration of rental vacancies and to assess their importance to the price adjustment mechanism for rental housing research findings indicate that duration varies with measures of msa housing costs and housing stock heterogeneity while incidence varies with measures of population mobility public housing availability and population growth results support a more general specification of rental price adjustment in which the rate of real rent change reflects deviations in observed vacancy incidence and duration from their equilibrium levels the research provides new estimates of equilibrium vacancy rates for a large set of metropolitan areas over the 1987 1996 period

do subsidies to cooperative r d actually stimulate r d investment and cooperation abstract a popular view in the industrial policy debate is that cooperation among firms r d departments should be encouraged the european community japan and the us all subsidize research cooperatives this study presents the first empirical test of the effectiveness of such subsidies using a database of competitors in 45 technological races the results indicate that subsidies that require cooperation in the form of result sharing agreements significantly increase the likelihood of cooperation but they decrease incentives to conduct r d subsidy programmes such as eureka that require cooperation but do not require result sharing agreements do not increase the likelihood of cooperation they do however increase incentives to conduct r d somewhat about to the same extent as subsidies that do not require cooperation

socially excessive dissemination of patent licences compared with the social optimum a monopolist usually sells too little this result seemingly includes the case of a lab that licences its patented cost innovation katz and shapiro 1986 find conditions under which the lab will issue fewer than the socially optimal number of licences however i find instead that its incentives can be socially too high the monopoly seller may sell too much for example it can be profit maximizing to sell several licences while it is socially optimal that none is sold en comparaison avec l optimum social un monopoleur habituellement vend trop peu voila qui semble tenir pour le cas d un laboratoire qui vend des licences pour une innovation brevetee qui reduit les couts katz shapiro 1986 ont montre dans quelles conditions le laboratoire va emettre moins que le nombre optimal de licences cependant l auteur decouvre que les incitations peuvent plutot l amener a en emettre trop plus que l optimum social par exemple il se peut que la maximisation du profit amene a vendre plusieurs licences alors qu il serait socialement optimal de n en vendre aucune

people places and earnings differentials in scotland abstractpeople places and earnings differentials in scotland regional studies this paper investigates the contribution of people and place effects to earnings differentials in scotland using individual and regional data the main sources of differentials are attributed to workers characteristics people effects particularly academic and vocational qualifications followed by occupational and industrial affiliations on the other hand differences in the attributes of local area labour markets place effects explain only a small part of individual earnings differentials the most relevant spatial attribute is local area human capital the findings suggest that people based policies are likely to be more effective at improving workers earnings prospects than place based policies

housing market equilibrium almost without vacancies the swiss housing market is characterised by an extraordinarily low vacancy rate generally in the vicinity of 1 per cent is the swiss housing market permanently in a condition of severe shortage this paper uses both a standard non accelerating rent inflation rate of vacancy approach and a new perception based approach to answer this question the available evidence confirms that a vacancy rate of 1 1 5 per cent is indeed sufficient for the swiss housing market to be in equilibrium provided only dwellings that are not only unoccupied but also actually offered for rent or purchase are counted which makes this rate not easily comparable with other countries the standard equilibrium vacancy rate approach suggests that even lower rates are sufficient in more densely built places whereas the approach based on perceptions makes no difference this suggests that the dwellings listed by people who wish to move reduce the pressure on rents but not the feeling of housing shortage

are private markets and filtering a viable source of low income housing estimates from a repeat income model while filtering has long been considered the primary mechanism by which markets supply low income housing direct estimates of that process have been absent this has contributed to doubts about the viability of markets and to misplaced policy i fill this gap by estimating a repeat income model using 1985 2011 panel data real annual filtering rates are faster for rental housing 2 5 percent than owner occupied 0 5 percent vary inversely with the income elasticity of demand and house price inflation and are sensitive to tenure transitions as homes age for most locations filtering is robust which lends support for housing voucher programs jel r21 r31 r38

going home evacuation migration decisions of hurricane katrina survivors in the wake of hurricane katrina many evacuees from the gulf region began the difficult process of deciding whether to rebuild or restart elsewhere we examine pre katrina gulf residents decision to return to the postdisaster gulf region which we call the return migration decision we estimate two separate return migration models first using data from a mail survey of individuals in the affected region and then focusing on self administered questionnaires of evacuees in houston our results indicate that return migration can be affected by household income age education level and employment marital and home ownership status but the results depend on the population under consideration we find no effect of connection to place on the return migration decision although the effect of income is relatively small within subsamples we find a much higher proportion of middle income households planning to return than lower income households when comparing across the subsamples in addition the real wage differential between home and host region influences the likelihood of return larger implicit costs in terms of foregone wages for returning induce a lower likelihood of return exploiting this difference at the individual level we are able to produce estimates of willingness to pay wtp to return home average wtp to return home for a sample of relatively poor households is estimated at 1 94 per hour or 3954 per year

lobbying political competition and local land supply recent evidence from spain abstract we analyze whether local land supply is influenced by the degree of political competition and interpret the findings as indications of the influence wielded by land developer lobbies we use a new database including both political and land supply data for more than 2 000 spanish municipalities for the period 2003 2007 in spain land use policies are largely a local responsibility with municipalities needing periodically to pass comprehensive land use plans the main policy variable in these plans and the one analyzed here is the amount of land classified for potential development we measure local political competition as the margin of victory of the incumbent government this variable is however potentially endogenous since not only do votes affect policy but also policy is expected to affect votes to deal with this problem we instrument this variable using the votes at the first national legislative elections following the re establishment of democracy and votes actually obtained regionally at the same type of election the results indicate that stiffer political competition does indeed reduce the amount of new land designated for development this effect is found to be most marked in suburbs in towns with a high percentage of commuters and homeowners and in municipalities governed by the left

re evaluating the impact of immigration on the u s rental housing market abstract previous studies provide evidence that immigration increases housing prices and rents to deal with endogenous location choices of immigrants these studies often use a shift share instrumental variable approach this approach however fails to adequately account for the natural attraction of immigrants to cities with thriving economies high immigration cities provide more economic opportunities and thus exhibit persistently rising housing prices and rents this paper improves upon the traditional empirical approach by explicitly controlling for initial city characteristics that lead to both increases in immigration and the evolution of rents results suggest that after controlling for endogenous sorting of immigrants the positive effect of immigration on rents is attenuated while the impact of immigrant inflows is smaller an extension of the main results suggests the effects of immigration on rents remains larger than that of native inflows

immigration and housing rents in american cities is there a local economic impact of immigration immigration pushes up rents and housing values in us destination cities the positive association of rent growth and immigrant inflows is pervasive in time series for all metropolitan areas i use instrumental variables based on a shift share of national levels of immigration into metropolitan areas an immigration inflow equal to 1 of a city s population is associated with increases in average rents and housing values of about 1 the results suggest an economic impact that is an order of magnitude bigger than that found in labor markets

bidding for firms recently toyota sought a plant location in the united states the 800 million plant will employ 3000 workers and numerous states offered toyota generous investment incentives hoping this would induce toyota to select their state the commonwealth of kentucky won this competition but the price was high the present value of the payments exceeds 125 million the payment of investment incentives for the toyota plant is not unique in 1976 pennsylvania paid 75 million to attract a volkswagen plan nissan honda and mazda received generous investment incentives when locating plants in the united states and this bidding is not limited to states to attract the headquarters of the presbyterian church usa with its 1300 jobs and 38 million annual payroll civic leaders in louisville kentucky offered the church a warehouse and 6 2 million for renovation of the structure bidding the church away from kansas city missouri in this paper we contend that this competition may result from the average cost pricing of publicly provided goods and services 2 when the marginal cost of providing a firm and its workers with public services is less than the tax revenue they generate a government may offer the firm subsidies that reduce the distortions the average cost pricing of the public service creates thus this competition for industry is not a zero sum game where the subsidies are only transfers from the government to the firm rather these subsidies may facilitate the efficient location of industry

the effect of immigration on productivity evidence from us states abstract in this paper we analyze the long run impact of immigration on employment productivity and its skill bias we use the existence of immigrant communities across u s states before 1960 and the distance from the mexican border as instruments for immigration flows we find no evidence that immigrants crowded out employment at the same time we find that immigration had a strong positive association with total factor productivity and a negative association with the high skill bias of production technologies the results are consistent with the idea that immigrants promoted efficient task specialization thus increasing tfp and also promoted the adoption of unskilled efficient technologies

the pot rush is legalized marijuana a positive local amenity this paper examines the amenity value of legalized marijuana by analyzing the impact of marijuana legalization on migration to colorado colorado is the pioneering state in this area having legalized medical marijuana in 2000 and recreational marijuana in 2012 we test whether potential migrants to colorado view legalized marijuana as a positive or negative local amenity we use the synthetic control methodology to examine in and out migration to from colorado versus migration to from counterfactual versions of colorado that have not legalized marijuana we find strong evidence that potential migrants view legalized marijuana as a positive amenity with in migration significantly higher in colorado compared with synthetic colorado after the writing of the ogden memo in 2009 that effectively allowed state laws already in place to be activated and additionally after marijuana was legalized in 2013 for recreational use when we employ permutation methods to assess the statistical likelihood of our results given our sample we find that colorado is a clear and significant outlier we find no evidence for changes in out migration from colorado suggesting that marijuana legalization did not change the equilibrium for individuals already living in the state jel i18 r23 k42 c22

illegal immigration border enforcement and relative wages evidence from apprehensions at the u s mexico border we examine illegal immigration in the united states from mexico over the period 1976 1995 one challenge is that we do not observe the number of individuals that attempt to enter the united states illegally we only observe the number of individuals apprehended attempting to cross the u s mexico border illegally based on a simple migration model we postulate the existence of an apprehensions function which expresses apprehensions at the border as a function of illegal attempts to cross the border and u s border enforcement effort we find that a 10 decrease in the mexican real wage leads to a 7 5 to 8 8 increase in apprehensions at the border excerpt

cooperation between rivals informal know how trading it has long been recognized that it is difficult for an innovating firm to fully appropriate the benefits arising from its innovations and that desired research might therefore not be performed nelson 1959 pp 297 306 one sometimes possible solution to this dilemma is cooperative r d conducted by firms who share the costs and benefits of particular r d projects johnson 1973

an analysis of cooperative research and development i analyze the effects of cooperative research whereby member firms agree to share the costs andfruits of a research project before they undertake it in this model industrywide agreements tend to have socially beneficial effects when the degree ofproduct market competition is low when there are r d spillovers in the absence of cooperation when a high degree of sharing is technologically feasible and when the agreement concerns basic research rather than development activities i show that a royalty free cross licensing agreement among any number offirms lowers the equilibrium level of innovation even though it increases the efficiency of r d through sharing

reversal of migration flows a fresh look at the german reunification we investigate the dynamic effects of interregional labor market integration on migration flows capital formation and the price for housing services the co evolution of these variables depends on initial conditions at the time of labor market integration in an initially capital poor economy there may be a reversal of migration flows during the transition to the steady state while housing costs are increasing over time although capital may accumulate while labor emigrates early in the transition the causal effect of immigration on capital investments and housing costs is positive we present new data on the evolution of net migration flows and rental rates for housing in east germany after 1990 our results are consistent with the presented evidence in the reverse migration scenario

immigration and the welfare state immigrant participation in means tested entitlement programs this paper documents the extent to which immigrants in the united states over the past 30 years participate in the many programs that make up the welfare state the immigrant native difference in the probability of receiving cash benefits is small but the gap widens once other programs are included in the analysis 21 percent of immigrant households receive some type of assistance as compared with only 14 percent of native households the types of benefits received by earlier immigrants influence the types of benefits received by newly arrived immigrants hence there might be ethnic networks that transmit information about the availability of particular benefits to new immigrants excerpt

new estimates of climate demand evidence from location choice abstract we develop and apply to census data a new method for estimating climate demand the method is useful for ranking quality of life based upon a willingness to pay criterion our two major findings are that the willingness to pay quality of life index is correlated with the hedonic approach s ranking but that the migration approach generates much larger estimates of willingness to pay for a more moderate climate this finding is relevant for evaluating the economic impact of global warming

unexpected guests the impact of internal displacement inflows on rental prices in colombian host cities abstract we study the causal impact of internally displaced people idp inflows on rental prices in colombian host cities following an instrumental variables approach we find that as idp inflows increase low income rental prices increase and high income rental prices decrease we provide empirical evidence on two potential mechanisms for these findings excess demand for low income housing puts upwards pressure on rental prices increasing supply of high income housing coupled with rising homicide rates put downwards pressure on rental prices

search liquidity and the dynamics of house prices and construction the dynamics of house prices sales construction and population growth in response to city specific income shocks are characterized for 106 us cities a dynamic model of search in the housing market in which construction the entry of buyers house prices and sales are determined in equilibrium is then developed the theory generates dynamics qualitatively consistent with the observations and a version calibrated to match key features of the us housing market offers a substantial quantitative improvement over models without search in particular variation in the time it takes to sell induces transaction prices to exhibit serially correlated growth jel d83 r21 r23 r31 we explore the consequences of time consuming search and matching for the dynamics of house prices sales and construction at the city level first we char acterize the impact of city specific income shocks on the short run dynamics of average house prices home sales construction and population growth for a panel of us cities we then develop a model in which the entry of new buyers and the construction of new houses in response to such shocks are endogenously determined our theory generates serial correlation in the growth rates of house prices and construction even if income is strictly mean reverting following shocks 1 when calibrated to data on us cities our model accounts for over 80 percent of the variance of house price movements driven by city specific income shocks and nearly half of the observed autocorrelation of house price growth in our empirical analysis we estimate a structural panel vector autoregressive var model using city level observations on the variables listed above we focus

wages rents and the quality of life this study focuses on the role of wages and rents in allocating workers to locations with various quantities of amenities the theory demonstrates that if the amenity is also productive then the sign of the wage gradient is unclear while the rent gradient is positive the theory is extended to include the housing market and nontraded goods these extensions require little modification of the conclusion the empirical work on wages shows that the regional wage differences can be explained largely by these local attributes with the use of site price data implicit prices are estimated and quality of life rankings for the cities are computed

timing is everything short run population impacts of immigration in us cities abstract we provide the first analysis of the short run causal impact of immigrant inflows on native populations at the local labor market level using published statistics from the american community surveys of 2000 2010 we examine how immigrant inflow shocks to a metropolitan area affect native populations we find that immigrant inflows are associated with increases in local native populations on an annual basis but that these ols estimates are generally upward biased our iv results are purged of this bias but we still find that an additional immigrant increases the low skill native population by 0 4 0 7 in the concurrent period to explain this result we show that immigrant inflows lead to declines in outflows of low skill natives from affected msas this is most pronounced in msas from which relocation is arguably more costly which may disproportionately affect the low skilled we find short run responses among high skill natives that are consistent with displacement the decline in high skilled native populations is driven by high skilled immigrant inflows and high skilled outflows increase from affected msas we show that these short run changes are obscured in specifications using longer run population changes and conclude that the short run impact of immigrants on native populations differs markedly from their longer run impact

the impact of income inequality on rental affordability an empirical study in large american metropolitan areas american metropolitan areas have experienced rising income inequality and worsening rental affordability in the past few decades has the rise of inequality caused worsening rental affordability t

crime in europe and the united states dissecting the reversal of misfortunes contrary to common perceptions today both property and violent crimes with the exception of homicides are more widespread in europe than in the united states while the opposite was true thirty years ago we label this fact as the reversal of misfortunes we investigate what accounts for the reversal by studying the causal impact of demographic changes incarceration abortion unemployment and immigration on crime for this we use time series data 1970 2008 from seven european countries and the united states we find that the demographic structure of the population and the incarceration rate are important determinants of crime our results suggest that a tougher incarceration policy may be an effective way to contrast crime in europe our analysis does not provide information on how incarceration policy should be made tougher nor does it provide an answer to the question whether such a policy would also be efficient from a cost benefit point of view we leave this to future research paolo buonanno francesco drago roberto galbiati and giulio zanella

disclosing own subsidies in cooperative research projects abstract this paper analyzes in a theoretical framework including asymmetric information and uncertainty first why firms participating in cooperative research projects may be interested in hiding information about own subsidies to their partners and second whether the public disclosure of subsidies would be welfare improving we show that the answers to those questions depend mainly on whether the efforts are strategic complements or substitutes and on the way in which the firms ex ante share the total expected profits from the project

mobility housing and labour markets in times of economic crises this special issue addresses the effects of the most recent financial and economic crisis starting in 2007 on mobility housing and labour markets in order to learn some lessons for the future t

the effect of low skilled immigration on u s prices evidence from cpi data i exploit the large variation across u s cities and through time in the relative size of the low skilled immigrant population to estimate the causal effect of immigration on prices of nontraded goods and services using an instrumental variables strategy i find that at current immigration levels a 10 percent increase in the share of low skilled immigrants in the labor force decreases the price of immigrant intensive services such as housekeeping and gardening by 2 percent wage equations suggest that lower wages are a likely channel through which these effects take place however wage effects are significantly larger for low skilled immigrants than for low skilled natives implying that the two are imperfect substitutes

ethnic enclaves and the economic success of immigrants evidence from a natural experiment recent immigrants tend to locate in ethnic enclaves within metropolitan areas the economic consequence of living in such enclaves is still an unresolved issue we use an immigrant policy initiative in sweden when government authorities distributed refugee immigrants across locales in a way that may be considered exogenous this policy initiative provides a unique natural experiment which allows us to estimate the causal effect on labor market outcomes of living in enclaves we find substantive evidence of sorting across locations when sorting is taken into account living in enclaves improves labor market outcomes for instance the earnings gain associated with a standard deviation increase in ethnic concentration is in the order of four to five percent

public selection and financing of r d cooperative projects credit versus subsidy funding abstract in this article we develop an analytical model of the selection process for r d cooperative projects to study the factors that motivate public project selection and corresponding funding using two different financial instruments subsidies and credits for this purpose we propose a three stage empirical strategy to analyse the differential individual effects of several factors on the decisions taken by the public agency this analysis is based on project level data from cooperative r d project calls under the spanish profit initiative for the period 2000 2003 the main results show that the public agency uses the two financial instruments to address different objectives first some projects close to the market are well supported through credits while basic research projects receive only selective support in the form of subsidies second there is significant diversity in the selection and funding of technological areas third regarding the explicit goal of fostering cooperation the public agency selectively favours partnerships with universities and technology institutes through the award of subsidies however there seems to be less incentive for large consortia fourth there are significant regional differences among financed projects and also our data show sharp yearly fluctuations

imitation costs and patents an empirical study it has long been recognised that the costs of imitating new products have an important effect on the incentives for innovation in a market economy as arrow i962 and others have pointed out if firms can imitate an innovation at a cost that is substantially below the cost to the innovator of developing the innovation there may be little or no incentive for the innovator to carry out the innovation in their discussions of the innovation process economists frequently have called attention to the major role played by the costs of imitation but there has been little or no attempt to measure these costs to test various hypotheses concerning the factors influencing them or to estimate their effects in this paper we report some findings of what seems to be the first study of this topic in addition we present data regarding the effects of patents on imitation costs and on the rate of innovation

room in the kitchen for the melting pot immigration and rental prices this paper studies the response of housing markets to immigration shocks following card 1990 i examine the changes in rental prices in miami and three comparison groups after the mariel boatlift this exogenous immigration shock added an extra 9 to miami s renter population in 1980 i find that rents increased from 8 to 11 more in miami than in the comparison groups between 1979 and 1981 by 1983 the rent differential was still 7 rental units of higher quality were not affected by the immigration shock units occupied by low income hispanic residents in 1979 experienced an extra 8 differential hike with respect to other low income units relative housing prices moved in the opposite direction from rents in the short run

immigration and wages evidence from construction to identify relative wage impacts of immigration we make use of certification and licensing requirements in the norwegian construction sector that give rise to exogenous variation in immigrant employment shares across trades individual panel data reveal substantially lower wage growth for workers in trades with rising immigrant employment than for other workers selective attrition from the sector masks the causal wage impact unless accounted for by individual fixed effects for low and semi skilled workers effects of new immigration are comparable for natives and older immigrant cohorts consistent with perfect substitutability between native and immigrant labor within trade finally we present evidence that immigration reduces price inflation as price increases over the sample period were significantly lower in activities with growth in the immigrant share than in activities with no or small change in immigrant employment

the interruption of income convergence and income growth in large cities in the 1980s recent studies have documented the divergence of per capita personal income among regions of the us in the 1980s following many decades of income convergence this paper establishes the same patter

housing vacancy and rental adjustment evidence from hong kong the traditional rental adjustment equation is flawed in that the equilibrium paths for the adjustment of rents and vacancy rates cannot hold simultaneously over time this paper suggests a two equation model of rental adjustments based on adaptive expectations rather than the single equation model presented in the traditional literature and provides empirical tests annual data from the housing market in hong kong during the 1980 96 period are consistent with the adjustment equation the results also show that the rate of change of real rents is neutral with respect to inflation

natural office vacancy rates some additional estimates excerpt in our recent paper shilling et al 2 we examined the rent adjustment process for 17 u s office markets and provided the first estimates of the natural vacancy rates in his comment voith 3 argues that our specification of the rent vacancy relationship is biased since we introduced an interaction term to capture the effect of risks associated with higher vacancy levels he suggests that an alternative specification would be to enter a vacancy squared term to capture this risk effect

why are population flows so persistent abstract a neoclassical model of local growth is developed by integrating the static equilibrium underlying compensating differential theory as the steady state of a neoclassical growth model numerical results show that even very small frictions to labor and capital mobility along with small changes in local productivity or local quality of life suffice to cause highly persistent population flows wages and house prices in contrast jump most of the way to their new steady state the model suggests that cross sectional regressions of local population growth can help to identify past and present changes in the determinants of representative agent welfare more generally it provides a framework for interpreting observed local growth rates

empty homes longer commutes the unintended consequences of more restrictive local planning abstract we investigate the impact of land use regulation on housing vacancy rates using a 30 year panel dataset on land use regulation for 350 english local authorities las and addressing potential reverse causation and other endogeneity concerns we find that tighter local planning constraints increase local housing vacancy rates a one standard deviation increase in restrictiveness causes the local vacancy rate to increase by 0 9 percentage points 23 the same increase in local restrictiveness also causes a 6 1 rise in commuting distances the results underline the interdependence of local housing and labour markets and the unintended adverse impact of more restrictive planning policies

at the origin of the industrial district alfred marshall and the cambridge school this paper investigates the origin and evolution of the concept of the industrial district the idea of industrial district is quite spread in modern industrial economics and in business studies with a variety of meanings and typologies indeed the true first original conceptualisation dates back to alfred marshall and the economists of the so called cambridge school quite often the concept of industrial district is considered as synonymous of agglomeration localisation and clustering but according to the meaning given originally by marshall these processes of industry territorialisation are quite different from the more compound localisation that is the marshallian industrial district therefore the aim of our contribution is focused on disentangling its original meaning from other subsequent interpretations referring particularly to the debate on this subject arisen among the economists of the cambridge school in the early fifties of the xx century

the effects of colleges and universities on local labor markets there is little systematic evidence documenting a relationship between colleges and universities and local economies using census data for 218 smsas this paper examines the relationship between various measures of university quality and local labor market conditions the authors find that area employment growth rates and the percentage of the work force employed as scientists and engineers are positively and significantly related to measures of university quality however the data can not reject the hypothesis that university quality has no significant effect on area income the employment rate net migration rates or even the share of employment in high tech industries copyright 1993 by mit press

fees versus royalties and the private value of a patent we compare how much profit an owner of a patented cost reducing invention can realize by licensing it to an oligopolistic industry producing a homogeneous product by means of a fixed fee or a per unit royalty our analysis is conducted in terms of a noncooperative game involving n 1 players the inventor and the n firms in this game the inventor acts as a stackelberg leader and it has a unique subgame perfect equilibrium in pure strategies it is shown that licensing by means of a fixed fee is superior to licensing by means of a royalty for both the inventor and consumers only a drastic innovation is licensed to a single producer

the economics of immigration this literature review concerns the impact of immigration on the economy of the host country focusing on the experience of the united states the emphasis is on the period from the 1970s to the 1990s the author shows that research earlier in this period generally concluded that the economic effects of immigration were positive but that more recent research on later migrations have generally concluded that immigration may be having an adverse effect on the earnings of native unskilled workers and be placing an increased burden on welfare programs the importance of such economic analysis for the formulation of appropriate migration policies is stressed

the effect of immigration on native self employment we examine the impact of immigration on self employed natives in a new general equilibrium model of self employment and wage salary work a range of plausible parameter values implies small negative effects of immigration on native self employment rates and earnings using 1980 and 1990 census microdata we then examine the relationship between changes in immigration and native self employment rates and earnings across 132 of the largest u s metropolitan areas we find evidence suggesting that self employed immigrants displace self employed natives but do not have a negative effect on native self employment earnings the effects are much larger than those predicted by the theoretical model

spatial housing economics a survey this introduction to the virtual special issue surveys the development of spatial housing economics from its roots in neoclassical theory through more recent developments in social interactions modelling and touching on the role of institutions path dependence and economic history the survey also points to some of the more promising future directions for the subject that are beginning to appear in the literature the survey covers elements of hedonic models spatial econometrics neighbourhood models housing market areas housing supply models of segregation migration housing tenure subnational house price modelling including the so called ripple effect and agent based models possible future directions are set in the context of a selection of recent papers that have appeared in urban studies nevertheless there are still important gaps in the literature that merit further attention arising at least partly from emerging policy problems these include more research on housing and biodiversity

speed of adjustment in commercial real estate markets the 1980s were less than favorable to the u s real estate industry vast amounts of overbuilding occurred in most areas and in most property types commercial vacancy rates increased dramatically and rents fell both in nominal and real terms untoward events tax laws changes deregulation of financial institutions and a real estate depression in many areas of the country virtually halted speculative development and caused a freefall in real estate prices real estate credit markets were crippled by the decade long crisis in the sl 6 21 adjustment speeds are important for understanding future effects of real estate price changes and for interpreting recent events the higher the adjustment speed the greater the fraction of long run adjustment experienced so far the smaller the adjustments still to be expected and the lower the implied long run demand elasticity adjustment speeds also have important implications for macroeconomic policy there is reason to believe for example that the slow economic growth in the u s during the four years of the bush administration was attributable in large part to the massive overbuilding that occurred in commercial property markets during the 1980s and the relatively slow process by which unemployed resources have been absorbed into productive new endeavors 16 in what follows we propose and test a stock adjustment model of real estate investment the

recent immigration and economic outcomes in rural america this paper assessed how recent immigrant flows have affected non metropolitan county labor market outcomes over the 2000 2005 period we find the largest impact to be increased net out migration of natives in the more remote rural counties dramatically less out migration of natives occurred in manufacturing dependent counties which also experienced reduced employment rates suggesting greater job queuing immigration was positively associated with net migration in persistently high poverty counties given the general absence of statistically significant adverse impacts on other labor market outcomes in these counties it is possible that immigration helps to revitalize persistently high poverty counties although point estimates suggested out migration may have been insufficient to equalize real wages

the effect of immigration on wages exploiting exogenous variation at the national level this paper estimates the effect of immigration on native wages at the national level taking into account the endogenous allocation of immigrants across skill cells time varying exogenous variation across skill cells for a given country is provided by interactions of push factors distance and skill cell dummies distance mitigates the effect of push factors more severely for less educated and middle experienced because the analysis focuses on the united states and canada i propose a two stage approach sub sample 2sls that estimates the first stage regression with an augmented sample of destination countries and the second stage equation with the restricted sub sample of interest i derive asymptotic results for this estimator and suggest several applications beyond the current one the empirical analysis indicates a substantial bias in estimated ols wage elasticities to immigration sub sample 2sls estimates average 1 2 and are very stable to the use of alternative instruments

commuting migration housing and labour markets complex interactions commuting migration housing and labour markets are important for the overall economy and for the everyday life of many people commuting makes up a large part of all journeys world wide and many resourcedemanding transport investment projects are initiated to cope with this type of travelling in a range of countries increasing flows of national and international migration are central determinants of demographic developments in industrialised countries the working age population or those aspiring to be part of the economically active population constitute a large proportion of the total population consequently income earned through working represents a major component of total earnings in these economies cahuc and zylberberg 2004 in order to obtain an efficient labour market workers should locate and relocate to where the relevant jobs are to be found from an economic point of view commuting and migration are essential elements for obtaining a well functioning labour market fischer et al 1996 lux and sunega 2012 zabel 2012 finally housing is a basic good and for many people rents or loan repayments make up a relatively large proportion of their overall budget oecd 2011 moreover housing represents a dominating element of homeowners wealth or equity due to its central role during the financial and economic crisis starting around 2007 it has become clear that housing prices are important for the development of the overall economy in many countries for example muellbauer and murphy 2008 zabel 2012 housing and labour markets are linked in many ways when explaining these links it is useful to start with some of the distinguished features of housing markets as already mentioned houses frequently constitute a major part of households wealth moreover earned income from employment is a major

networks in the modern economy mexican migrants in the u s labor market this paper attempts to identify job networks among mexican migrants in the u s labor market the empirical analysis uses data on migration patterns and labor market outcomes based on a sample of individuals belonging to multiple origin communities in mexico over a long period of time each community s network is measured by the proportion of the sampled individuals who are located at the destination the united states in any year we verify that the same individual is more likely to be employed and to hold a higher paying nonagricultural job when his network is exogenously larger by including individual fixed effects in the employment and occupation regressions and by using rainfall in the origin community as an instrument for the size of the network at the destination

price adjustment process for rental office space abstract this paper analyzes the price adjustment process for rental office space in 17 cities across the united states over the time period 1960 to 1975 the results confirm much of what economic theory suggests landlords react to fluctuations in demand by building up or drawing down inventories of unlet or vacant office space other things equal higher levels of vacant office space mean that landlords lower their rents and reduce the difference between desired and actual vacancies empirical evidence is also presented on the normal vacancy rate across different cities

supply constraints and housing market dynamics abstract although the volatility of house prices is often ascribed to demand side factors constraints on housing supply have important and little studied implications for housing dynamics i illustrate the strong relationship between the volatility of house prices and the regulation of new housing supply i then employ a dynamic structural model of housing investment to investigate the mechanisms underlying this relationship i find that supply constraints increase volatility through two channels first regulation lowers the elasticity of new housing supply by increasing lags in the permit process and adding to the cost of supplying new houses on the margin second geographic limitations on the area available for building houses such as steep slopes and water bodies lead to less investment on average relative to the size of the existing housing stock leaving less scope for the supply response to attenuate the effects of a demand shock my estimates and simulations confirm that regulation and geographic constraints play critical and complementary roles in decreasing the responsiveness of investment to demand shocks which in turn amplifies house price volatility

pricing for the clean air evidence from chinese housing market abstract air pollution is widely believed to cause healthy risks and influence nations economic dimensions this paper investigates the impact of air pollution on housing prices in china s 286 prefectural level cities during 2005 2013 to address the endogeneity problem of pm2 5 concentrations in our regression we propose an instrument variable strategy based on ventilation coefficient the estimation results suggest that a 10 increase in pm2 5 concentrations causes a 2 4 reduction in local housing prices air pollution also hinders the progress of urbanization limits cities human capital formation and changes people s expectations of housing prices that we interpret as three potential mechanisms behind our main findings

the labour market impact of immigration in the first part of this paper we present a stylized model of the labour market impact of immigra tion we then discuss mechanisms through which an economy can adjust to immigration changes in factor prices output mix and production technology in the second part we explain the problems of empirically estimating how immigration affects labour market outcomes of the resident population and review some strategies to address these we then summarize some recent empirical studies for the uk and other countries we conclude with an outlook on what we believe are important avenues for future research

riding the wave of urban growth in the countryside spread backwash or stagnation the advisability of an urban centered growth strategy to reap the benefits of urban agglomeration economies is much debated rural areas benefit when the growth spreads to the hinterlands especially within daily commuting distance yet in distant peripheral locations urban growth may create a backwash as households relocate to the urban center this study examines spread vs backwash as separate from long run distance from urban center trend effects using a novel canadian gis database the unique nation wide approach yields a spread and backwash rural growth topography that varies by distance from the urban center by urban population vs income growth and by size of rural community

the price adjustment process for rental housing and the natural vacancy rate institute of a university of ii business and california economic research berkeley center for real estate and urban economics working paper series working paper 82 53 the price adjustment process for rental housing and the natural vacancy rate by kenneth t rosen lawrence b smith these ers are preliminary in natu heir purpose 39 to stimulate discussion comm therefore t are n ted or q d in any pub on wit the express permissi the author graduate school of business administration