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A Spatial Knowledge Economy

Donald R. Davis and Jonathan Dingel ()

American Economic Review, 2019, vol. 109, issue 1, 153-70

Abstract: Leading empiricists and theorists of cities have recently argued that the generation and exchange of ideas must play a more central role in the analysis of cities. This paper develops the first system of cities model with costly idea exchange as the agglomeration force. The model replicates a broad set of established facts about the cross section of cities. It provides the first spatial equilibrium theory of why skill premia are higher in larger cities and how variation in these premia emerges from symmetric fundamentals.

JEL-codes: J24 J31 O31 R12 R23 (search for similar items in EconPapers)
Date: 2019
Note: DOI: 10.1257/aer.20130249
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Working Paper: A Spatial Knowledge Economy (2012) Downloads
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