Hostname: page-component-cd9895bd7-fscjk Total loading time: 0 Render date: 2024-12-25T02:06:17.827Z Has data issue: false hasContentIssue false
  • English
  • Français

Trade and institutions: explaining urban giants

Published online by Cambridge University Press:  01 July 2019

Fabien Candau Open the ORCID record for Fabien Candau [Opens in a new window]  and
Tchapo Gbandi
Fabien Candau*
Affiliation:
Center for the Analysis of Trade and Economic Transition, Université de Pau et des Pays de l'Adour, Pau, France
Tchapo Gbandi
Affiliation:
Center for the Analysis of Trade and Economic Transition, Université de Pau et des Pays de l'Adour, Pau, France
*
*Corresponding author. Email: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

By analyzing the population growth at the top of the urban hierarchy, we test two hypotheses explaining the rise of mega-cities: trade and political institutions. We find that democratic institutions are the main factor behind the concentration of a nation's urban population in the main city. Contrary to the literature, we find that extractive institutions reduce the size of the biggest city.

Keywords

Urban primacydemocracymarket access
Type
Research Article
Information
Journal of Institutional Economics , Volume 15 , Issue 6 , December 2019 , pp. 1017 - 1035
Copyright
Copyright © Millennium Economics Ltd 2019 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Acemoglu, D., Johnson, S., and Robinson, J. A. (2002), ‘Reversal of Fortune: Geography and Institutions in the Making of the Modern World Income Distribution’, Quarterly Journal of Economics, 117: 1231–1294.Google Scholar
Acemoglu, D., Robinson, J. A. and Verdier, T. (2004), ‘Kleptocracy and Divide-and-Rule: A Model of Personal Rule’, Journal of the European Economic Association, 2: 162–192.Google Scholar
Acemoglu, D., Naidu, S., Restrepo, P. and Robinson, J. A. (2017), ‘Democracy Does Cause Growth’, Journal of Political Economy, forthcoming.Google Scholar
Ades, A. and Glaeser, E. (1995), ‘Trade and Circuses: Explaining Urban Giants’, Quarterly Journal of Economics, 110: 195–227.10.2307/2118515Google Scholar
Albouy, D. (2012), ‘The Colonial Origins of Comparative Development: An Empirical Investigation: Comment’, American Economic Review, 102: 3059–3076.10.1257/aer.102.6.3059Google Scholar
Anthony, R. M. (2014), ‘Bringing up the Past: Political experience and the Distribution of Urban Populations’, Cities, 37: 33–46.10.1016/j.cities.2013.11.005Google Scholar
Bai, C-H., Hsieh, C-T. and Song, Z. (2019), ‘Special Deals with Chinese Characteristics’, NBER Macroeconomics Annual, forthcoming.Google Scholar
Bates, R. H (1981), Markets and States in Tropical Africa: The Political Basis of Agricultural Policies, Berkeley: University of California Press.Google Scholar
Behrens, K. and Robert-Nicoud, F. (2014), ‘Survival of the Fittest in Cities: Urbanisation and Inequality’, Economic Journal, 124: 1371–1400.10.1111/ecoj.12099Google Scholar
Candau, F. (2008), ‘Good Governance, Trade and Agglomeration’, Papers in Regional Science, 87: 483–504.10.1111/j.1435-5957.2008.00169.xGoogle Scholar
Candau, F. (2011), ‘Is Agglomeration Desirable?’ Annals of Economics and Statistics, 101/102: 203–228.10.2307/41615480Google Scholar
Candau, F. and Dienesch, E. (2015), ‘Spatial Distribution of Skills and Regional Trade Integration’. Annals of Regional Science, 54: 451–480.10.1007/s00168-015-0662-4Google Scholar
Collier, P. and Venables, A. J. (2013), ‘Housing and Urbanization in Africa: Unleashing a Formal Market Process’, Centre for the Study of African Economies, Working Paper Series 2013–01, University of Oxford.Google Scholar
Combes, P. P., Duranton, G. and Gobillon, L. (2011), ‘The Identification of Agglomeration Economies’, Journal of Economic Geography, 11: 253–266.Google Scholar
Crenshaw, E. M. and Anthony, R. M. (2014), City Size and Political Contention, International Journal of Sociology, 44: 7–33.Google Scholar
Davis, J. and Henderson, J. V. (2003), ‘Evidence on the Political Economy of the Urbanization Process’, Journal of Urban Economics 53: 98–125.10.1016/S0094-1190(02)00504-1Google Scholar
Docquier, F., Lodigiani, E., Rapoport, H. and Schiff, M. (2016), ‘Emigration and Democracy’, Journal of Development Economics, 120: 209–223.Google Scholar
Duranton, G. (2008), ‘Viewpoint: From Cities to Productivity and Growth in Developing Countries’, Canadian Journal of Economics, 41:689–736.Google Scholar
Eeckhout, J. (2004), ‘Gibrat's Law for (All) Cities’, American Economic Review, 94: 1429–1451.10.1257/0002828043052303Google Scholar
Feler, L. and Henderson, J. V. (2011), ‘Exclusionary Policies in Urban Development: Under-servicing Migrant Households in Brazilian Cities’, Journal of Urban Economics, 69: 253–272.10.1016/j.jue.2010.09.006Google Scholar
Findlay, R. and O'Rourke, K. H. (2009), Power and Plenty: Trade, War, and the World Economy in the Second Millennium, Princeton: Princeton University Press.10.2307/j.ctv6zdc8pGoogle Scholar
Giuliano, P., Spilimbergo, A. and Tonon, G. (2014), ‘Genetic Distance, Transportation Costs, and Trade’, Journal of Economic Geography, 14: 179–198.10.1093/jeg/lbt019Google Scholar
Guiso, L., Sapienza, P. and Zingales, L. (2009), ‘Cultural Biases in Economic Exchange?’ Quarterly Journal of Economics, 124: 1095–1131.Google Scholar
Head, K. and Mayer, T. (2002), ‘Illusory Border Effects: Distance Mismeasurement Inflates Estimates of Home Bias in Trade’, CEPII Working Paper 2002–01.Google Scholar
Helpman, H. (1998), ‘The Size of Region’, in Pines, D., Sadka, E. and Zildcha, I. (eds), Topic in Public Economics: Theoretical and Applied Analysis, Cambridge: Cambridge University Press, pp. 33–54.Google Scholar
Henderson, J. V. and Wang, H. G. (2007), ‘Urbanization and City Growth: the Role of Institutions’, Regional Science and Urban Economics, 37: 283–313.10.1016/j.regsciurbeco.2006.11.008Google Scholar
Henderson, J. V., Storeygard, A. and Weil, D. N.. (2012), ‘Measuring Economic Growth from Outer Space’, American Economic Review, 102: 994–1028.Google Scholar
Karayalcin, C. and Yilmazkuday, H. (2015), ‘Trade and Cities’, World Bank Economic Review, 29: 523–549.Google Scholar
Krugman, P. (1991), ‘Increasing Returns and Economic Geography’, Journal of Political Economy, 99: 483–499.Google Scholar
Krugman, P. and Livas, E. R. (1996), ‘Trade Policy and the Third World Metropolis’, Journal of Development Economics, 49: 137–150.Google Scholar
Lerner, D. (1958), The Passing of Traditional Society: Modernizing the Middle East, New York: Free Press.Google Scholar
Lipset, S. M. (1959), ‘Some Social Requisites of Democracy: Economic Development and Political Legitimacy’, American Political Science Review, 53: 69–105.Google Scholar
Lipton, M. (1977), Why Poor People Stay Poor: Urban Bias in World Development, Cambridge, MA: Harvard University Press.Google Scholar
Majumdar, S., Mani, A. and Mukan, S. (2004), ‘Politics, Information and the Urban Bias’, Journal of Development Economics, 75: 137–165.Google Scholar
Milner, V. H. and Mukherjee, B. (2009), ‘Democratization and Economic Globalization’, Annual Review of Political Sciences, 12:163–181.Google Scholar
Mokyr, J. (2016), A Culture of Growth: The Origins of the Modern Economy, Princeton: Princeton University Press.Google Scholar
Nitsch, V. (2006), ‘Trade Openness and Urban Concentration: New Evidence’, Journal of Economic Integration, 21, 340–362.Google Scholar
Nunn, N. and Puga, D (2012), ‘Ruggedness: The Blessing of Bad Geography in Africa’, Review of Economics and Statistics, 94: 20–36.Google Scholar
Pemberton, T. J., DeGiorgio, M. and Rosenberg, N. A. (2013), ‘Population Structure in a Comprehensive Genomic Data Set on Human Microsatellite Variation’, G3: Genes, Genomes, Genetics, 3: 903–919.Google Scholar
Pesaran, H. and Zhou, Q. (2016), ‘Estimation of Time-invariant Effects in Static Panel Data Models’, Econometric Reviews, 37: 1137–1171.Google Scholar
Rauch, J. E. and Trindade, V. (2002), ‘Ethnic Chinese Networks in International Trade’, Review of Economics and Statistics, 84: 116–130.Google Scholar
Redding, S. and Venables, A. J. (2004), ‘Economic Geography and International Inequality’, Journal of International Economics, 62: 53–82.Google Scholar
Santos Silva, J. and Tenreyro, S. (2006), ‘The Log of Gravity’, Review of Economics and Statistics, 88: 641–658.Google Scholar
Spolaore, E. and Wacziarg, R. (2018), ‘Ancestry and Development: New Evidence’, Journal of Applied Econometrics, 33: 748–762.Google Scholar
Staiger, D. and Stock, J. (1997), ‘Instrumental Variables Regression and Weak Instruments’, Econometrica, 65: 557–586.Google Scholar
Weber, M (1909), ‘Urbanization and Social Structure in the Ancient World’, in Runciman, W. G. (ed.), Weber: Selections in Translation, Cambridge: Cambridge University Press, pp. 290–314.Google Scholar