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Andrea Caragliu: Who’s Right, Weber or Glaeser?

city at night
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Date and location: November 7, 4:30 p.m. in 115 West Sibley Hall

Andrea Caragliu is an associate professor in regional and urban economics at Politecnico di Milano. Since January 2019, he has been the executive director of the Regional Science Association International (RSAI). He is the book review editor of the Papers in Regional Science. Caragliu holds a Ph.D. in management, economics, and industrial engineering (Politecnico di Milano, 2010). His dissertation was awarded the Merit Prize of the EU Committee of the Regions Prize for the Best Doctoral Dissertation and was also awarded the Diploma d’Onore AISRe for the best doctoral dissertation in regional science “Giorgio Leonardi” 2010. Caragliu also holds a Ph.D. in spatial economics (VU University Amsterdam, 2015), master’s and bachelor’s degrees in economics (Bocconi University in Milan, 2005 and 2003, respectively), and was a visiting student in the spatial economics department of the Free University of Amsterdam in 2008–09. Caragliu has published in various international refereed journals such as Economic Geography, Journal of Regional Science, Journal of Economic Geography, Papers in Regional Science, and Journal of Urban Technology.


In this paper, we measure the relative importance of consumption and production-related amenities as sources of agglomeration economies. To this aim, we exploit a large database comprising about 70 percent of all house transactions in the Netherlands in the period 2005–11, CBS neighborhood data from the Wijk-en Buurtkaart, data on monuments from the Rijksdienst voor het Cultureel Erfgoed, data on firm-level productivity from Orbis, and, lastly, L.I.S.A. data of all registered firms in the Netherlands. The paper provides two main contributions: We measure the intensity of the productivity effect of consumption and production-related amenities for the Dutch case, and we observe whether the relative intensity of the two effects changes over the observed time span, following recent theoretical predictions. Our findings suggest that both consumption and production-related externalities are reflected in house prices and firm productivity. In particular, urban land rent increases with the intensity of competition, as well as with the presence of local consumption amenities (major monuments, theatres, and restaurants). Firms also tend to be more productive when located closer to sources of consumption amenities, although the evidence is less compelling. Results are robust to a number of robustness checks, as well as to the use of instrumental variables, with soil composition as the main instrument. Instead, we find no evidence of a relative decline of the importance of production externalities with respect to consumption amenities.

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