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The Size Distribution of Cities with Distance-Bound Households

Axel Watanabe ()

MPRA Paper from University Library of Munich, Germany

Abstract: There has been a long tradition of presumed perfect mobility in urban economics. Workers switch their locations in direct response to differences in local economic performance. Recent empirical observations prove otherwise. The number of movers rapidly declines with distance moved while there is a positive correlation between distance moved and skill level. I build a general equilibrium model of a system of cities to explain the city-size distribution as a result of reduced mobility. Workers with a heterogeneous skill level have a corresponding distance-tolerance level and self-sort into select cities. The resulting size distribution reflects the trade-off between the distance moved and earning opportunities enhanced by agglomeration. I extrapolate consumers’ tolerance towards distance and skill level from US Census data on city size and intercity migration.

Keywords: labor mobility; internal migration; city-size distribution (search for similar items in EconPapers)
JEL-codes: J61 R12 (search for similar items in EconPapers)
Date: 2020-04-17
New Economics Papers: this item is included in nep-ore and nep-ure
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