Urban, Rural, Regional, Real Estate, and Transportation Economics
Does entrepreneurship cause urban economic growth and if so how large is the impact? Empirical analysis of such question is hampered by endogeneity. This paper uses two different sets of variables – the homestead exemption levels in state bankruptcy laws from 1975 and the share of MSA overlaying aquifers - to instrument for entrepreneurship and examine urban growth between 1993 and 2002. Despite using different sets of instrumental variables, the ranges of 2SLS estimates are similar, further supporting the significant impact of entrepreneurship on urban growth.
This paper examines the impact of government guaranteed small business loans on urban economic growth, and compares the growth impacts of government versus market financed entrepreneurship. OLS estimates indicate a significant and positive relation between the Small Business Administration’s guaranteed loans and metropolitan growth between 1993 and 2002. However, first-difference and instrumental variable regressions show no growth impact from government guaranteed loans. In contrast, market entrepreneurship significantly and positively contributes to local economic growth.
This paper examines how an autocratic regime domestically counters the impact of economic sanctions. A stylized model predicts that, as long as non-compliance is not too costly, the autocrat redistributes resources to the more valuable urban area when sanctions increase. Empirically, I examine the case of North Korea. I use the satellite night lights data to create average luminosity for each one minute by one minute cell between 1992 and 2010. I construct a sanctions index that varies based on the international response to North Korea’s nuclear pursuit.
Private finance of infrastructure grew substantially during the last twenty five years. Part of the growth has been caused by public-private partnerships (PPPs), which bundle investment and service provision of single public infrastructure projects into a long-term contract with a private single-purpose firm. Because most PPPs enjoy few economies of scope and assets are project specific, project finance is appropriate. PPP projects are highly levered. Banks tend to finance construction. During the operation of the project, bond finance substitutes for bank lending.
This paper assesses empirically whether China's central bank should react to house prices and if so how. We use three kinds of VAR models including structural VARs with a combination of short-run and long-run restrictions to solve the endogeneity problem of identifying shocks to monetary policy and house prices. Broader money supply (M2) and the one-year lending rate are used as monetary policy proxies according to the distinctive background in China. The interaction between M2 and house prices is much more evident than the effects of M2 and house prices on GDP and CPI.
Since the 1998 “wind of falsification and embellishment,” Chinese official GDP statistics have repeatedly come under scrutiny. This paper evaluates the quality of China’s GDP statistics in four stages. First, it reviews past and ongoing suspicions of the quality of GDP data and examines the evidence. Second, it documents the institutional framework for data compilation and concludes on the implications for data quality. Third, it asks how the National Bureau of Statistics could possibly go about credibly falsifying GDP data without being found out.
We propose a dynamic spatial theory to analyze the geographic impact of climate change. Agricultural and manufacturing firms locate on a hemisphere. Trade across locations is costly, firms innovate, and technology diffuses over space. Energy used in production leads to emissions that contribute to the global stock of carbon in the atmosphere, which affects temperature. The rise in temperature differs across latitudes and its effect on productivity also varies across sectors.