We examine the impact of low-carbon city (LCC) initiatives on labour investment decisions (quantity, quality, and well-being). Using a time-varying difference-in-differences approach based on staggered implementations of such a pilot program, we report an inefficient outcome - absolute deviation of labour investment from the optimal net hiring – especially for firms in labour-intensive industries and firms with high financial slack or adjustment costs. We, however, observe increased investments in highly skilled personnel and compensated with employee stock ownership, especially by firms under intense pressure to reduce carbon emissions. Such initiatives are also closely associated with the significant enhancement of workplace safety. Overall, LCC helps to upgrade the corporate labour structure by hiring more skilled employees through reduced agency problems and heightened green innovation.

Social preferences facilitate the internalization of health externalities, for example, by reducing mobility during a pandemic. We test this hypothesis using mobility data from 258 cities worldwide alongside experimentally validated measures of social preferences. Controlling for time-varying heterogeneity that could arise at the level at which mitigation policies are implemented, we find that they matter less in regions that are more altruistic, patient, or exhibit less negative reciprocity. In those regions, mobility falls ahead of lockdowns, and remains low after the lifting thereof. Our results elucidate the importance, independent of the cultural context, of social preferences in fostering cooperative behavior.

Over the last decade, German housing prices have increased unprecedentedly. Drawing on quality-adjusted housing price data at the district level, we document large and increasing regional disparities: Growth rates were higher in 1) the largest seven cities, 2) districts located in the south, and 3) districts with higher initial price levels. Indications of price bubbles are concentrated in the largest cities and in the purchasing market. Prices seem to be driven by the demand side: Increasing population density, higher shares of academically educated employees and increasing purchasing power explain our findings, while supply remained relatively constrained in the short term.

This paper studies the economic and political effects of a large trade shock in agriculture – the grain invasion from the Americas – in Prussia during the first globalisation (1871-1913). We show that this shock accelerated the structural change in the Prussian economy through migration of workers to booming cities. In contrast to studies using today’s data, we do not observe declining per capita income and political polarisation in counties affected by foreign competition. Our results suggest that the negative and persistent effects of trade shocks we see today are not a universal feature of globalisation, but depend on labour mobility. For our analysis, we digitise data from Prussian industrial and agricultural censuses on the county level and combine it with national trade data at the product level. We exploit the cross-regional variation in cultivated crops within Prussia and instrument with Italian trade data to isolate exogenous variation.

Urban economies are composed of diverse activities, embodied in labor occupations, which depend on one another to produce goods and services. Yet little is known about how the nature and intensity of these interdependences change as cities increase in population size and economic complexity. Understanding the relationship between occupational interdependencies and the number of occupations defining an urban economy is relevant because interdependence within a networked system has implications for system resilience and for how easily can the structure of the network be modified. Here, we represent the interdependencies among occupations in a city as a non-spatial information network, where the strengths of interdependence between pairs of occupations determine the strengths of the links in the network. Using those quantified link strengths we calculate a single metric of interdependence–or connectedness–which is equivalent to the density of a city’s weighted occupational network. We then examine urban systems in six industrialized countries, analyzing how the density of urban occupational networks changes with network size, measured as the number of unique occupations present in an urban workforce. We find that in all six countries, density, or economic interdependence, increases superlinearly with the number of distinct occupations. Because connections among occupations represent flows of information, we provide evidence that connectivity scales superlinearly with network size in information networks.