Heterogeneous Agglomeration

Many prior treatments of agglomeration explicitly or implicitly assume that all industries agglomerate for the same reasons. This paper uses U.K. establishment-level coagglomeration data to document substantial heterogeneity across industries in the microfoundations of agglomeration economies. It finds robust evidence of organizational and adaptive agglomeration forces as discussed by Chinitz (1961), Vernon (1960), and Jacobs (1969). These forces interact with the traditional Marshallian (1890) factors of input sharing, labor pooling, and knowledge spillovers, establishing a previously unrecognized complementarity between the approaches of Marshall and Jacobs, as well as others, to the analysis of agglomeration

Gut Microbial Trimethylamine Is Elevated in Alcohol-Associated Hepatitis and Contributes to Ethanol-Induced Liver Injury in Mice

There is mounting evidence that microbes residing in the human intestine contribute to diverse alcohol-associated liver diseases (ALD) including the most deadly form known as alcohol-associated hepatitis (AH). However, mechanisms by which gut microbes synergize with excessive alcohol intake to promote liver injury are poorly understood. Furthermore, whether drugs that selectively target gut microbial metabolism can improve ALD has never been tested. We used liquid chromatography tandem mass spectrometry to quantify the levels of microbe and host choline co-metabolites in healthy controls and AH patients, finding elevated levels of the microbial metabolite trimethylamine (TMA) in AH. In subsequent studies, we treated mice with non-lethal bacterial choline TMA lyase (CutC/D) inhibitors to blunt gut microbe-dependent production of TMA in the context of chronic ethanol administration. Indices of liver injury were quantified by complementary RNA sequencing, biochemical, and histological approaches. In addition, we examined the impact of ethanol consumption and TMA lyase inhibition on gut microbiome structure via 16S rRNA sequencing. We show the gut microbial choline metabolite TMA is elevated in AH patients and correlates with reduced hepatic expression of the TMA oxygenase flavin-containing monooxygenase 3 (FMO3). Provocatively, we find that small molecule inhibition of gut microbial CutC/D activity protects mice from ethanol-induced liver injury. CutC/D inhibitor-driven improvement in ethanol-induced liver injury is associated with distinct reorganization of the gut microbiome and host liver transcriptome. The microbial metabolite TMA is elevated in patients with AH, and inhibition of TMA production from gut microbes can protect mice from ethanol-induced liver injury

Agglomeration and Job Matching among College Graduates

We study one potential source of urban agglomeration economies: better job matching. Focusing on college graduates, we construct two direct measures of job matching based on how well an individual's job corresponds to his or her college education. Consistent with matching-based theories of urban agglomeration, we find evidence that larger and thicker local labor markets help college graduates find better jobs by increasing both the likelihood and quality of a match. We then assess the extent to which better job matching of college-educated workers increases individual-level wages and thereby contributes to the urban wage premium. While we find that college graduates with better job matches do indeed earn higher wages on average, the contribution of such job matching to aggregate urban productivity appears to be relatively modest

Shared Knowledge and the Coagglomeration of Occupations

This paper provides an empirical analysis of the extent to which people in different occupations locate near one another, or coagglomerate. We construct pairwise Ellison-Glaeser coagglomeration indices for U.S. occupations and use these measures to investigate the factors influencing the geographic concentration of occupations. The analysis is conducted separately at the metropolitan area and state levels of geography. Empirical results reveal that occupations with similar knowledge requirements tend to coagglomerate and that the importance of this shared knowledge is larger in metropolitan areas than in states. These findings are robust to instrumental variables estimation that relies on an instrument set characterizing the means by which people typically acquire knowledge. An extension to the main analysis finds that, when we focus on metropolitan areas, the largest effects on coagglomeration are due to shared knowledge about the subjects of engineering and technology, arts and humanities, manufacturing and production, and mathematics and science

Pollution and the Efficiency of Urban Growth

We analyze the efficiency of urbanization patterns in a dynamic model of endogenous urban growth with two sectors of production. Production exhibits increasing returns to scale on aggregate. Urban environmental pollution, as a force that discourages agglomeration, is caused by domestic production. We show that cities are too large and too few in number in equilibrium, compared to the efficient urbanization path, if economic growth implies increasing aggregate emissions. If, on the other hand, production becomes cleaner over time (`quality growth') the urbanization path approximates the efficient outcome after finite time

Crime, Inequality, and the Private Provision of Security

In a high-crime environment with many high-income citizens, private security companies which offer protection against crime can flourish. In this article crime is modelled as a game where richer victims yield a higher return on crime, but with decreasing returns to crime as more criminals choose crime to supplement their income. Private security providers offer protection against crime and face Cournot competition. The model allows for the analysis of market clearing prices for effort against crime. Among the implications of the model are that rising inequality will lead to more expenditure on protection against crime, and that the upper income classes are suffering from the same or lower crime density than the middle income class. Taking into account the response of criminals and victims, rising inequality can actually lead to less crime if either (i) the legal income opportunity of the marginal criminal increases or (ii) marginal utility from income decreases and richer individuals spend a higher proportion of their income on protection (i.e. protection is a superior good). Often the middle class suffers from higher crime densities as inequality increases, as the increased spending on protection by the upper class (i) shifts crime to the middle class and (ii) increases market prices for protection, leaving the middle class with less affordable protection against crime. Emigration of the middle class can then further increase inequality. This highlights the importance of taking into account the response of individuals against crime and shows that the link between inequality and crime is a complex one.In diesem Artikel wird Kriminalität als Spiel modelliert, in welchem wohlhabenere Opfer mehr Gewinn erbringen; dieser Gewinn nimmt aber ab, je mehr Kriminelle sich auf wohlhabene Opfer konzentrieren. Private Sicherheitsdienstleister bieten Schutz gegen Kriminalität an und stehen im Cournot-Wettbewerb miteinander. Das Modell erlaubt die Untersuchung markträumender Preise für Sicherheitsdienstleistungen. Das Modell impliziert unter anderem, dass steigende Ungleichheit der Einkommensverteilung zu höheren Ausgaben für Sicherheitsdienstleistungen führt, und dass die oberen Einkommensschichten unter dem gleichen oder sogar geringeren Maß an Kriminalität leiden als mittlere Einkommensschichten. Es zeigt sich, dass steigende Ungleichheit Kriminalität sogar reduzieren kann, wenn (i) legale Einkommensmöglichkeiten des marginalen Kriminellen steigen und/oder (ii) der Grenznutzen des Einkommens abnimmt und wohlhabendere Individuen einen höheren Anteil ihres Einkommens für (superiore) Sicherheitsdienstleistungen ausgeben. Mittlere Einkommensschichten können bei steigender Ungleichheit unter mehr Kriminalität leiden, da steigende Ausgaben für Sicherheit durch höhere Einkommensschichten (i) Kriminalität auf niedrigere Einkommensschichten verlagern und (ii) den Marktpreis für Sicherheitsdienstleistungen erhöhen. Emigration der mittleren Einkommensschichten kann dann zu einem weiteren Anstieg der Ungleichheit führen