YUE YU

Welcome! I am an assistant professor in economics at the University of Toronto, with cross-appointment at UTSC Management and the Rotman School of Management. My research interest lies in urban economics, economic geography, international trade, and development economics.

Email: yueyu.yu@utoronto.ca

CV is available here.


If you are an undergrad or graduate student looking for RA work, please email me with a CV or resume, as well as an unofficial transcript. In your email, please also include a couple sentences about your research interests.

Working Papers

Awarded UEA Prize for Best Student Paper (Honorable Mention) and EMUEA Kraks Fond Prize (Runner-Up), 2019

Abstract: Many countries have land-use regulations to preserve farmland from urban sprawl. In this paper, I show that such regulations can distort economic activity across sectors and locations at a substantial cost to aggregate welfare in developing countries during urbanization. I study a major policy restricting farm-to-urban land conversion in China - the Farmland Red Line Policy - to provide causal evidence on the impact of land-use regulation on local development measured by GDP and population growth. The policy imposes an extra cost on urban land development, which depends on exogenous local geographical features. I show that a larger extra cost driven by the geographical features significantly reduces urban land supply, lowers GDP, and decreases population. To understand the aggregate impact of the policy, I develop a quantitative spatial equilibrium model that features endogenous land-use decisions. According to the model, the policy causes an excess supply of farmland and an under-supply of urban land, and the extent of such land misallocation varies across locations due to their local geographical features. In the constrained equilibrium, the spatial and sectoral mobility of workers implies that land misallocation leads to labor misallocation. The calibrated model reveals that the welfare of workers would have been 6% higher in 2010 if the policy had not been implemented.

Abstract: This paper examines the importance of geographic spillovers on a firm's export activities. We leverage a quasi-experiment -- China's high-speed rail (HSR) expansion -- that dramatically reduces traveling time and increases geographic spillovers between connected cities. With the HSR opening, the geographical spillovers from connected cities increase a firm's export revenue, the number of export countries, the frequency to update its product varieties, and an overall expansion of its product menu. The empirical findings are consistent with a heterogeneous firm model that allows geographic proximity to other export activities to affect the costs of accessing foreign markets. Additionally, we demonstrate that the geographic spillover effects are heterogeneous along dimensions such as firm size, product complexity, and firm location.

Work in Progress


The Value of Cleaner Waterways, with Qianyang Zhang (Columbia University)

Every year, billions of dollars are spent on cleaning up urban water pollution worldwide. Nevertheless, it is unclear whether cleaner waterways can raise local property values or boost local businesses. This paper exploits the Black-and-Smelly Water Program in China as a natural experiment, combined with detailed housing transaction records, to provide causal evidence of the value of cleaner waterways capitalized into real estate properties. First implemented in 2016, this program has cleaned up almost all the heavily polluted waterways in the 36 most developed cities in China. We compare the property values close to the cleaned-up waterways with those further away, before and after the program. We find that the program mainly benefits the real estate properties within 1 mile from the cleaned-up waterways: the market values of these properties appreciate by 8\% after the program. Furthermore, various service businesses thrive in the neighborhoods close to the cleaned-up waterways, which revitalize the neighborhoods and contribute to increasing property values.

Teaching

I serve as an instructor at the University of Toronto-Scarborough for the following courses:

  • Introduction to Regression Analysis

  • Theory and Practice of Regression Analysis