Spring 2019 - 60360 - PA 393L - Advanced Policy Economics

Urban Economics and Policy

This course will be closed on Oct. 29th, with a waitlist activated. Students who add themselves to the waitlist and who have not previously received credit for PA 393L will be added to the course at 8:00 am on Oct. 30th, after which time the course will be open to all students. If all seats are filled before we open the course, the waitlist will be opened as well.

We are at the first point in history where over half of the world population lives in cities, and urbanization is only expected to grow with time: as high as 70% of the population by 2050. Any study of the policy approaches to improving the quality of life therefore ought to consider the role of cities in economic development and human welfare. The importance of cities is something of a puzzle to economics: why would someone move to one given their many disadvantages: traffic, crime, pollution and a high cost of living? The answer to this puzzle must lie in something about the role of proximity in economic and social welfare. Part of the usefulness of economics in this context is its ability to relate outcomes that are determined simultaneously in proximate markets: for example the interaction of outcomes in school districts with those in nearby housing markets. This course tries to unpack these relationships by applying the tools of microeconomics to explore how urban economies work and the effects of policy on their outcomes.

The approaches and topics in the course will be relevant for those expecting to work in urban policy or politics as well as those interested in policies which have their biggest impact at the local level. We will discuss the effects of policies to address crime, local economic development, inequality, and pollution. We will also examine the effect of the Great Recession and its aftermath on eviction and gentrification. We will explore the effect of climate change on cities and how US cities (and states) are forming policies to try to mitigate greenhouse gas emissions in the absence of coordinated national policy. Finally we will try to understand important factors that affect cities in developing and emerging market countries such as informal housing, infrastructure development and the effects of pollution on health.

The course will have an initial urban economic theory component including problem sets and a single in-class midterm exam, but will then transition into applied policy topics. This latter portion of the class will incorporate two short data-intensive projects that students will synthesize into two-page policy notes. Weekly readings will be selections of textbook chapters or one to two academic papers. Students will be expected to lead a discussion of these papers during some class sessions.