We construct a new micro-geographic commercial rent index for Germany to study the capitalization of agglomeration economies into floor space prices. In large local labor markets, commercial rents decline by -17% per kilometer from the central business district, compared to 13% for residential rents, reflecting stronger agglomeration benefits at the center. Commercial rents in central business districts increase with local labor market size at an elasticity of 15%, implying that wage responses capture only about half of the agglomeration effect on total factor productivity.
We employ a quantitative spatial model that accounts for trade frictions---generated by trade costs and non-tradable services---and mobility frictions---generated by idiosyncratic tastes and local ties---to recover unobserved quality of life (QoL) and estimate the urban QoL premium. For Germany, we find that a city twice as large offers, on average, a 22% higher QoL to the average resident—far exceeding the urban wage premium of 4%. Our model-based Monte Carlo simulations suggest that the lack of strong empirical evidence for an urban QoL premium in earlier literature likely stems from measurement error in the Rosen-Roback framework due to omitted spatial frictions.
This paper leverages quasi-experimental variation from store openings and 1.5 billion grocery transactions to causally estimate the distance elasticity of grocery expenditures (-1.47) and the spatial extent of local consumption areas (approximately 16 minutes of car travel time). We embed these estimates in a nested CES demand framework to construct a granular index of local market access for nearly 350,000 grid cells (100x100m) across Switzerland. Urban areas enjoy nearly twice the consumption access of rural areas, with the 90th-to-10th percentile ratio nationally exceeding four. Compensating variation calculations show that low-income and elderly households would benefit disproportionately from improved local market access. Finally, we document that market access varies predominantly between locations, whereas income differs mostly within locations---the two dimensions are nearly orthogonal. This suggests that place-based retail policies and income-based transfers address fundamentally different dimensions of spatial inequality and should be regarded as complements.
LSE Blog: "Lockdown shows us it is not work that attracts us to big cities – but the social life", Blog London School of Economics
LSE Blog: "What is the optimal minimum wage?", Blog London School of Economics
Gabriel Ahlfeldt, Stephan Heblich, and Tobias Seidel
Regional Science and Urban Economics 98, January 2023, 103836
Marcel Henkel, Tobias Seidel, and Jens Suedekum
American Economic Journal: Economic Policy 13(4), 433-468, 2021
Tobias Seidel and Jan Wickerath
Regional Science and Urban Economics 85, November 2020, 103580
Maximilian von Ehrlich and Tobias Seidel
Scandinavian Journal of Economics 121(4), 1533-1560, 2019
Marcel Henkel and Tobias Seidel
Economic Inquiry 57(1), 333-354, 2019
Maximilian von Ehrlich and Tobias Seidel
American Economic Journal: Economic Policy 10(4), 344-374, 2018
Policy summary (in German): ifo Dresden berichtet (issue 3, 2015) pdf
Gabriel Ahlfeldt, Duncan Roth, and Tobias Seidel
Economics Letters 172, 127-130, 2018
Peter Egger, Sebastian Kunert, and Tobias Seidel
Economica 85(340), 771-792, 2018
Hartmut Egger, Peter Egger, and Tobias Seidel
Canadian Journal of Economics 48(5), 1883-1901, 2015
Tobias Seidel
The World Economy 38(6), 899-912, 2015
Maximilian von Ehrlich and Tobias Seidel
European Economic Review 73, 85-102, 2015
Peter Egger and Tobias Seidel
European Economic Review 63, 225-242, 2013
Maximilian von Ehrlich and Tobias Seidel
Regional Science and Urban Economics 43, 539-548, 2013
Keith E. Maskus, Rebecca Neumann, and Tobias Seidel
European Economic Review 56, 72-83, 2012.
Peter Egger and Tobias Seidel
Oxford Economic Papers 63, 722-739, 2011
Peter Egger, David Greenaway, and Tobias Seidel
Canadian Journal of Economics 44, 509-540, 2011
Tobias Seidel
Economics Letters 107, 214–216, 2010
Ossip Hühnerbein and Tobias Seidel
The World Economy 33, 1042–1051, 2010
Sascha O. Becker, Peter Egger, and Tobias Seidel
European Journal of Political Economy 25, 300–310, 2009
Peter Egger and Tobias Seidel
Canadian Journal of Economics 41, 271–291, 2008
Place-based policy in India: How Special Economic Zones promoted structural change and women's employment, VoxDev article, December 2024
Optimale regionale Transfers, Wirtschaftsdienst - Zeitschrift für Wirtschaftspolitik, Heft 104, 763-767, 2024
Spatial implications of minimum wages, VoxEU article, 2018
A Germany without fiscal transfers, VoxEU article, 2018
Finanzierung von F&E: Worauf kommt es an?, Ökonomenstimme, www.oekonomenstimme.org; August 2011
Fiskalpolitik in Deutschland: Eine empirische Analyse am Beispiel des Vorziehens der Steuerreform, (with Michael Plötscher and Frank Westermann), Kredit und Kapital, 38(1), 23–51, 2005
Welfare effects of capital mobility with rigid wages, Applied Economics Quarterly, Supplement 56, 61–75, 2005
Gains from trade and labour market flexibility, CESifo DICE Report, Journal of Institutional Comparisons, Vol. 3, No.1, Spring 2005
Globalisierung und Arbeitsmärkte: Welche Auswirkungen haben Standortverlagerungen für Deutschland?, ifo Dresden berichtet 5/2004
Konjunkturelle Auswirkungen des Vorziehens der Steuerreform, (mit Frank Westermann), ifo Schnelldienst 01/2004