Publication

New information technologies and reductions in transportation costs have led pundits to pronounce the “death of distance.” These claims would suggest that distance is no longer a barrier to growth for remote areas and small urban centers. Despite the extensive research on the localized effects of agglomeration, very few studies have empirically investigated the broader spillover effects of proximity and location in the urban system. This study attempts to fill this void using U.S. county level employment data. A primary innovation is that urban centers, from which distance is measured, are differentiated by their position within six tiers (rural plus 5 urban) of the American urban hierarchy. Net agglomeration economies can thus originate from multiple sources throughout the entire 360° span. Our findings indicate that proximity to higher-tiered urban centers is an important positive determinant of local job growth, all the way from the smallest to largest urban centers. Thus, the geographic reach of agglomeration economies for growth appears to extend much farther than typically presumed and is not diminishing.