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Size, Sprawl, Speed and the Efficiency of Cities

The efficiency of cities, defined here as labour productivity, adjusted for differences in industry-mix, is hypothesised to be a function of the 'effective size' of the labour market of cities, defined as the average number of jobs available in less than t minutes to workers in the city. This hypothesis is verified on a sample of 23 French cities. This effective size of the labour market is further explained by three factors: the size of the city; the average potential job-home distance (sprawl); and the average speed at which journey to work takes place. The same sample of 23 cities is used to determine the elasticities of the effective size of the labour market with respect to each of these three factors.