here's a theory. shoot it down: work and cash are more abundant and salaries are higher in urban areas and this causes demand-pull price inflation.
why are salaries higher? because the labor pools in high density urban areas have, in some sectors, a more highly developed set of skills and capabilities than the comparable labor pools in other areas have (e.g. Wall Street bankers and quants, NYC chefs and restaurant workers, SV programmers and capital managers, San Diego life sciences and biotech, etc). IOW, agglomeration economies.
Comments
here's a theory. shoot it down: work and cash are more abundant and salaries are higher in urban areas and this causes demand-pull price inflation.
why are salaries higher? because the labor pools in high density urban areas have, in some sectors, a more highly developed set of skills and capabilities than the comparable labor pools in other areas have (e.g. Wall Street bankers and quants, NYC chefs and restaurant workers, SV programmers and capital managers, San Diego life sciences and biotech, etc). IOW, agglomeration economies.