Global Distribution of Economic Activity

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Data for replicating The Global Spatial Distribution of Economic Activity: Nature, History, and the Role of Trade (forthcoming 2018; with Vernon Henderson, Tim Squires and David N. Weil) Quarterly Journal of Economics

We explore the role of natural characteristics in determining the worldwide spatial distribution of economic activity, as proxied by lights at night, observed across 240,000 grid cells. A parsimonious set of 24 physical geography attributes explains 47% of worldwide variation and 35% of within-country variation in lights. We divide geographic characteristics into two groups, those primarily important for agriculture and those primarily important for trade, and confront a puzzle. In examining within-country variation in lights, among countries that developed early, agricultural variables incrementally explain over 6 times as much variation in lights as do trade variables, while among late developing countries the ratio is only about 1.5, even though the latter group is far more dependent on agriculture. Correspondingly, the marginal effects of agricultural variables as a group on lights are larger in absolute value, and those for trade smaller, for early developers than for late developers. We show that this apparent puzzle is explained by persistence and the differential timing of technological shocks in the two sets of countries. For early developers, structural transformation due to rising agricultural productivity began when transport costs were still high, so cities were localized in agricultural regions. When transport costs fell, these agglomerations persisted. In late-developing countries, transport costs fell before structural transformation. To exploit urban scale economies, manufacturing agglomerated in relatively few, often coastal, locations. Consistent with this explanation, countries that developed earlier are more spatially equal in their distribution of education and economic activity than late developers.

This dataset is part of the Global Research Program on Spatial Development of Cities funded by the Multi-Donor Trust Fund on Sustainable Urbanization of the World Bank and supported by the U.K. Department for International Development.

Type: 
Geospatial
Languages Supported: 
English
Topics: 
Economic Growth
Environment and Natural Resources
Trade
Urban Development
GP & CCSAs: 
Social, Urban, Rural & Resilience
WB Project ID: 
P145658
Granularity: 
Geographical Coverage: 
World
Economy Coverage: 
Blend
High Income
IBRD
IDA
Low Income
Lower Middle Income
Upper Middle Income
Number of Economies: 
196
Periodicity: 
Periodicity not specified
Release Date: 
February 6, 2018
Access Options:
Download
Publisher Name: 

Global Research Program on Spatial Development of Cities

Organization: 
World Bank
Funding Name, Abbreviation, Role: 
Multi-Donor Trust Fund on Sustainable Urbanization of the World Bank and supported by the U.K. Department for International Development.
Time Periods: 
October, 2017

No Visualizations Available.

J Vernon Henderson, Tim Squires, Adam Storeygard, David Weil; The Global Distribution of Economic Activity: Nature, History, and the Role of Trade, The Quarterly Journal of Economics, Volume 133, Issue 1, 1 February 2018, Pages 357–406, https://doi.org/10.1093/qje/qjx030

Data for replicating The Global Spatial Distribution of Economic Activity: Nature, History, and the Role of Trade (forthcoming 2018; with Vernon Henderson, Tim Squires and David N. Weil) Quarterly Journal of Economics

We explore the role of natural characteristics in determining the worldwide spatial distribution of economic activity, as proxied by lights at night, observed across 240,000 grid cells. A parsimonious set of 24 physical geography attributes explains 47% of worldwide variation and 35% of within-country variation in lights. We divide geographic characteristics into two groups, those primarily important for agriculture and those primarily important for trade, and confront a puzzle. In examining within-country variation in lights, among countries that developed early, agricultural variables incrementally explain over 6 times as much variation in lights as do trade variables, while among late developing countries the ratio is only about 1.5, even though the latter group is far more dependent on agriculture. Correspondingly, the marginal effects of agricultural variables as a group on lights are larger in absolute value, and those for trade smaller, for early developers than for late developers. We show that this apparent puzzle is explained by persistence and the differential timing of technological shocks in the two sets of countries. For early developers, structural transformation due to rising agricultural productivity began when transport costs were still high, so cities were localized in agricultural regions. When transport costs fell, these agglomerations persisted. In late-developing countries, transport costs fell before structural transformation. To exploit urban scale economies, manufacturing agglomerated in relatively few, often coastal, locations. Consistent with this explanation, countries that developed earlier are more spatially equal in their distribution of education and economic activity than late developers.

This dataset is part of the Global Research Program on Spatial Development of Cities funded by the Multi-Donor Trust Fund on Sustainable Urbanization of the World Bank and supported by the U.K. Department for International Development.

FieldValue
Modified Date
2021-03-15
Release Date
Periodicity
Identifier
063a2ffc-a1c5-4da2-8c31-a89918bcd21f
License
License Not Specified
Contact Email
Rating: 
5
Average: 5 (1 vote)
Type: 
Languages Supported: 
Time Periods: 
October, 2017
Publisher Name: 
Global Research Program on Spatial Development of Cities
Number of Economies: 
196
Geographical Coverage: 
Data Classification of a Dataset: 
WB Project ID: 
P145658
SUR
Release Date: 
Tuesday, February 6, 2018
Organization: 
World Bank
Granularity: 
Citation Text: 
J Vernon Henderson, Tim Squires, Adam Storeygard, David Weil; The Global Distribution of Economic Activity: Nature, History, and the Role of Trade, The Quarterly Journal of Economics, Volume 133, Issue 1, 1 February 2018, Pages 357–406, https://doi.org/10.1093/qje/qjx030
Modified date: 
96
Primary Dataset: 
Yes
Funding Name, Abbreviation, Role: 

Multi-Donor Trust Fund on Sustainable Urbanization of the World Bank and supported by the U.K. Department for International Development.

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CC-BY 4.0

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