The Employment Cycles of Neighboring Cities

Wall, Howard J. (2011): The Employment Cycles of Neighboring Cities.

Abstract

This paper examines the spatial interaction of neighboring cities over their employment cycles. The cycles of neighboring cities tend to be more similar to one another than are those of non-neighboring cities, although this is due primarily to neighbors’ tendency to be in the same state. In addition to these same-state effects, neighborness interacts with industry and human capital in ways that make the cyclical interaction of neighbors different from that of non-neighbors. Specifically, neighboring cities with similar levels of educational attainment and establishment size tend to have more-similar employment cycles, but neighboring cities with similar racial compositions tend to have less-similar employment cycles.

• Item Type: MPRA Paper
• Language: English
• Keywords: Neighboring cities, employment cycles
• Subjects: R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R10 - General; E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E32 - Business Fluctuations ; Cycles

References

Abdel-Rahman, H.M and A. Anas (2005). Theories of Systems of Cities. In Henderson, V. and J.F. Thisse (Eds.), Handbook of Regional and Urban Economics, 4. Amsterdam: Elsevier, 2293-2340.

Arnott, R. (1998). Economic Theory and the Spatial Mismatch Hypothesis. Urban Studies 35(7), 1171-1185.

Berliant, M. and P. Wang (2008). Urban Growth and Subcenter Formation: A Trolley Ride from the Staples Center to Disneyland and the Rose Bowl. Journal of Urban Economics 63, 679-693.

Carlino. G.A. and L. Mills (1993). Are U.S. Regional Incomes Converging? A Time Series Analysis. Journal of Monetary Economics 32, 335-346.

Carlino, G.A. and R.H. DeFina (1995). Regional Income Dynamics. Journal of Urban Economics 37, 88-106.

Carlino, G.A. and R.H. DeFina (1998). The Differential Regional Effects of Monetary Policy. Review of Economics and Statistics 80, 572-587.

Carlino, G.A. and R.H. DeFina (2004). How Strong is Co-Movement in Employment Over the Business Cycle? Evidence from State/Sector Data. Journal of Urban Economics 55, 298-315.

Carlino, G. and K. Sill (2001). Regional Income Fluctuations: Common Trends and Common Cycles. Review of Economics and Statistics 83, 446-456.

Christaller, W. (1933). Central Places in Southern Germany, In translation (1966), translated by Baskin, C.W. Prentice–Hall, Englewood Cliffs, New Jersey.

Clark, T. (1998). Employment Fluctuations in U.S. Regions and Industries: The Roles of National, Region-Specific, and Industry-Specific Shocks. Journal of Labor Economics, 202-229

Del Negro, M. (2002). Asymmetric Shocks Among U.S. States. Journal of International Economics 56, 273-297

Dobkins, L.H. and Y.M Ioannides (2001). Spatial Interactions among U.S. Cities: 1900-1990. Regional Science and Urban Economics 31(6), 701-731.

Engemann, K.M. and H.J. Wall (2010). The Effects of Recessions Across Demographic Groups. Federal Reserve Bank of St. Louis Review 92(1), 1-26.

Fujita, M., P. Krugman, and T. Mori (1999). On the Evolution of Hierarchical Urban Systems. European Economic Review 43, 209-251.

Fujita M. and T. Mori (1997). Structural Stability and the Evolution of Urban Systems. Regional Science and Urban Economics 27, 399-442.

Hamilton, J.D. (1989). A New Approach to the Economic Analysis of Nonstationary Time Series and the Business Cycle. Econometrica 57, 357-384.

Hamilton, J.D. and M.T. Owyang (forthcoming). The Propagation of Regional Recessions. Review of Economics and Statistics.

Harding, D. and A. Pagan (2002). Dissecting the Cycle: A Methodological Investigation. Journal of Monetary Economics 49, 365-381.

Hellerstein, J.K., D. Neumark, and M. McInerney (2008). Spatial Mismatch or Racial Mismatch? Journal of Urban Economics 64, 464-479.

Hoynes, H. (2000). The Employment and Earnings of Less Skilled Workers Over the Business Cycle. In D.E. Card and R.M. Blank (Eds.), Finding Jobs: Work and Welfare Reform. New York: Russell Sage Foundation, 23-71.

Kim, C.J. and C. Nelson (1999). State-Space Models with Regime Switching: Classical and Gibbs-Sampling Approaches with Applications. Cambridge, MA: MIT Press.

Martin, R.W. (2004). Can Black Workers Escape Spatial Mismatch? Employment Shifts, Population Shifts, and Black Unemployment in American Cities. Journal of Urban Economics 55, 179-194.

McMillen, D.P. and S.C. Smith (2003). Then Number of Subcenters in Large Urban Areas. Journal of Urban Economics 5, 321-338.

Owyang, M.T., J. Piger, and H.J. Wall (2005). Business Cycle Phases in U.S. States. Review of Economics and Statistics 87, 604-616.

Owyang, M.T., J. Piger, and H.J. Wall (2010). Discordant City Employment Cycles. Federal Reserve Bank of St. Louis Working Paper 2010-019A.

Owyang, M.T., J. Piger, and H.J. Wall (2008). A State-Level Analysis of the Great Moderation. Regional Science and Urban Economics 38(6), 578-579.

Owyang, M.T., J. Piger, H.J. Wall, and C.H. Wheeler (2008). The Economic Performance of Cities: A Markov-Switching Approach. Journal of Urban Economics 64(3), 538-550.

Owyang, M.T., D. Rapach, and H.J. Wall (2009). States and the Business Cycle. Journal of Urban Economics 65(2), 181-194.

Partridge, M.D and D.S. Rickman (2002). Did the New Economy Vanquish the Regional Business Cycle? Contemporary Economic Policy 20(4), 456-469.

Partridge, M.D and D.S. Rickman (2005). Regional Cyclical Asymmetries in an Optimal Currency Area: An Analysis Using US State Data. Oxford Economic Papers 57(3), 373-397.

Rossi-Hansberg E, P.-D. Sarte, and R.. Owens III (2009). Firm Fragmentation and Urban Patterns. International Economic Review 50(1), 143-186.