Consumption Cities versus Production Cities : New Considerations and Evidence
Cities dramatically vary in their sectoral composition across the world, possibly lending credence to the theory that some cities are production cities with high employment shares of urban tradables while others are consumption cities with high employment shares of urban non-tradables. A model of structural change highlights three paths leading to the rise of consumption cities: resource rents from exporting fuels and mining products, agricultural exports, and premature deindustrialization. These findings appear to be corroborated using both country- and city-level data. Compared to cities in industrialized countries, cities of similar sizes in resource-rich and deindustrializing countries have lower shares of employment in manufacturing, tradable services, and the formal sector, and higher shares of employment in non-tradables and the informal sector. Results on the construction of “vanitous” tall buildings provide additional evidence on the relationship between resource exports and consumption cities. Finally, the evidence suggests that having mostly consumption cities might have economic implications for a country.
| Main Authors: | , , |
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| Format: | Working Paper biblioteca |
| Language: | English en_US |
| Published: |
Washington, DC : World Bank
2022-06
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| Subjects: | STRUCTURAL CHANGE, URBANIZATION, CONSUMPTION CITIES, MACRO-DEVELOPMENT ECONOMICS, INDUSTRIALIZATION, NATURAL RESOURCES, DEINDUSTRIALIZATION, CONSTRUCTION, |
| Online Access: | http://documents.worldbank.org/curated/en/099549506242213625/IDU060925f8c024ec0463108b23050ec1534f97a http://hdl.handle.net/10986/37624 |
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| Summary: | Cities dramatically vary in their
sectoral composition across the world, possibly lending
credence to the theory that some cities are production
cities with high employment shares of urban tradables while
others are consumption cities with high employment shares of
urban non-tradables. A model of structural change highlights
three paths leading to the rise of consumption cities:
resource rents from exporting fuels and mining products,
agricultural exports, and premature deindustrialization.
These findings appear to be corroborated using both country-
and city-level data. Compared to cities in industrialized
countries, cities of similar sizes in resource-rich and
deindustrializing countries have lower shares of employment
in manufacturing, tradable services, and the formal sector,
and higher shares of employment in non-tradables and the
informal sector. Results on the construction of “vanitous”
tall buildings provide additional evidence on the
relationship between resource exports and consumption
cities. Finally, the evidence suggests that having mostly
consumption cities might have economic implications for a country. |
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