Study looks at Urban Density Premium.

• Position: Brief article

Doubling of urban density is associated with an increase in average establishment earnings of between 7 and 10 percent, according to a recent study from the Chicago Federal Reserve. This estimate holds using alternate measures of urban density taking into account the simultaneous location choices of workers and firms.

In the Urban Density Premium across Establishments, the Chicago Fed estimates the density premium for U.S. establishments, controlling for a variety of observable establishment characteristics and dynamic establishment behavior that may be endogenously related to urban density.

The study is available at http://www.chicagofed.org/webpages/publications/ working_papers/2013/wp_01.cfm.

Government Finance Officers Association

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