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Cities, regions and the decline of transport costs

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Fifty Years of Regional Science

Part of the book series: Advances in Spatial Science ((ADVSPATIAL))

Abstract

The theoretical framework of urban and regional economics is built on transportation costs for manufactured goods. But over the twentieth century, the costs of moving these goods have declined by over 90% in real terms, and there is little reason to doubt that this decline will continue. Moreover, technological change has eliminated the importance of fixed infrastructure transport (rail and water) that played a critical role in creating natural urban centres. In this article, we document this decline and explore several simple implications of a world where it is essentially free to move goods, but expensive to move people. We find empirical support for these implications.

Glaeser thanks the National Science Foundation, the Taubman Center, and the Rappaport Institute for support and Jesse Shapiro for providing tremendous assistance. Kohlhase thanks Jia-Huey Ling and Anuja Krishnan for helpful research assistance.

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Author information

Authors and Affiliations

  1. Department of Economics, Littauer Center 315A, Harvard University, Cambridge, MA, 02138, USA

    Edward L. Glaeser

  2. Department of Economics, University of Houston, Houston, TX, 77204-5019, USA

    Janet E. Kohlhase

Authors
  1. Edward L. Glaeser
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  2. Janet E. Kohlhase
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Editor information

Editors and Affiliations

  1. Department of Agricultural Economics, Purdue University, West Lafayette, IN, 47907, USA

    Raymond J. G. M. Florax

  2. Department of Spatial Economics, Free University, De Boelelaan 1105, 1081 HV, Amsterdam, The Netherlands

    Raymond J. G. M. Florax

  3. Department of Geography and Regional Development, University of Arizona, Harvill Building, Box 2, Tucson, Arizona, 85721, USA

    David A. Plane

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Glaeser, E.L., Kohlhase, J.E. (2004). Cities, regions and the decline of transport costs. In: Florax, R.J.G.M., Plane, D.A. (eds) Fifty Years of Regional Science. Advances in Spatial Science. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-662-07223-3_9

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  • DOI: https://doi.org/10.1007/978-3-662-07223-3_9

  • Publisher Name: Springer, Berlin, Heidelberg

  • Print ISBN: 978-3-642-06111-0

  • Online ISBN: 978-3-662-07223-3

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