The reduction in homicides in major cities such as Los Angeles and New York City is a great accomplishment.  As crime declines, people spend more time outside and gain more from living in the city.  The city gains from having more "eyes on the street" as this builds up civic engagement, nightlife and encourages the private sector to invest more in high quality retail and entertainment to cater to these "night owls".  The net result is a more vibrant and fun city.

As my term as the Chairman of USC's Economics Department ends on August 15th, I have been focusing on my new initiative at Johns Hopkins University.  At JHU, I am directing the 21st Century Cities Initiative.     This blog post is meant to both market this initiative and to offer some benchmarks for judging my center's performance.

Our Mission Statement is simple.  I want 21CC to be the campus hub for research, teaching and outreach on topics related to urban economic growth, urban poverty and urban quality of life.  Given our location, Baltimore will be an important city for us but we will also benchmark Baltimore relative to other U.S cities and I continue to be fascinated by urbanization around the world.  We will be opportunistic in terms of what urban places and topics we study around the world.  As we find young scholars with particular geographic interests (and we find pots of $ to support such scholars), we will focus more attention on those areas.

What are we currently doing?

First, I am setting up the infrastructure to continue with my own urban research on issues related to climate change adaptation, and mitigation. We have already hired a pre-doc and graduate students will also be visiting our center.

Second,  we issued a call for proposals on campus both for funding urban research by faculty and a second call for proposals for funding PHD research.  I was impressed with the quality of the proposals that were submitted.

Third, we are working with other JHU research centers on campus to hold new public facing conferences to highlight what we do and what we will achieve in the future.  I am eager to work with the Urban Health Initiative in the future.

Fourth, we are working with Beth Blauer's GovEx and Hahrie Han's Agora Institute to organize student events to highlight opportunities for students to apply what they learn in the classroom to the "real world".  We will hold a climate change event in early September.   Throughout the school year, we will be inviting in outside speakers (including Brad Humphreys and Rucker Johnson) to speak to students and the general public about key urban issues.

Fifth,  we are working with several partners on campus to apply for external funding.

Sixth,  we are engaging with entities in Washington DC who work on urban issues.  My recent 2019 co-authored World Bank paper is one example.  

Seventh,  we are engaging with City of Baltimore officials to learn about the issues that they seek "Big Data" advice on.  With our capacity for data crunching, we hope to earn their trust in helping them to better understand the challenges and the opportunities that the city faces.

Eight,  we are working with colleagues at the JHU Economics Department to set up an urban economics/finance group to study the financing challenges that Baltimore communities and small businesses face.

Nine,  we are establishing relationships with the growing number of climate "Big Data" entities that are actively collating and generating data related to the geography of emerging climate risks.

Tenth,  I am continuing to work on the economics of China's urbanization.  Building on my co-authored 2016 book, there is plenty of work that needs to be done here.

Eleventh.   My Bloomberg Chair at JHU is joint between the Economics Department and the Carey School.  I want to build close ties between my center and the business community.  The Carey School's faculty and students will be important constituents for my 21CC center.  In a free market, the business sector plays a key role in creating the economic growth that creates the tax base that allows the federal, state and local governments to be able to engage in poverty remediation.  A booming local economy is the best anti-poverty tool.  Thus, we must continue to investigate what attracts and repels firms from locating in a given city. 

My center will specialize in conducting new applied microeconomics research at the intersection of urban and environmental issues that uses Big Data to inform public policy.   An example of what we will produce is my recent co-authored paper on crime and heat.  

While I was extremely busy doing administrative work for USC (when I was the chair), I did learn how to do such work and how to interact with  dozens of diverse people who often had conflicting agendas (Deans, students, junior faculty, senior faculty,  teaching faculty, other colleagues on campus, staff, donors).    Now, I will take this knowledge and apply it to building new knowledge related to urban economic growth, urban quality of life and addressing the urban poverty challenge.

New Delhi will offer women free use of public transit.  As this mode of transit is now cheaper, more women will ride it. In this blog post, I want to discuss how this shift in the composition of riders (that a larger % of riders will be female) affects demand.

Gary Becker taught social interaction consumption models. He stressed two cases. In the "snob good" case,  Jane's demand for a product declines if everyone else is consuming it.  In the "bandwaggon case", Jane's demand for a product increases if everyone else is consuming it.   In the case of female public transit use, I predict that the bandwaggon equilibrium will emerge due to a "strength in numbers". If young women anticipate that a large % of riders will also be female, they will feel safer and this will increase their likelihood of riding public transit.  This is a type of community policing as other women will be looking out for their safety.  The low price of public transit has a direct incentive effect encouraging women to ride it and it solves a co-ordination problem as women will know that other women will be riding with them.

This point has been studied in a more general setting by Pat Bayer and Chris Timmins.

In the traditional discrete choice demand model (such as choosing whether to commute by bus, car or by foot),  people compare the exogenous attributes of each choice (so commuting by foot is cheap but slow while commuting by car is expensive but fast) and make their best choice.  As the researcher observes each person's choice set and their actual choice, the researcher can use revealed preference logic to estimate the weights that the decision maker placed on the relative importance of each product attribute.

Bayer and Timmins extend this logic by arguing that not only does a product such as a Tesla (in the discrete car choice problem) have unique features but another feature of this product is the demographics of who consumes it.

So, suppose that Matt values the Tesla's raw acceleration power and he also likes the fact that the typical Tesla buyer is a "cool person".   Note that this 2nd attribute is an emergent property of who buys the car.   If Elon Musk could nudge more "cool people" to buy his car, then this would further increase the demand for the Tesla even if its physical attributes do not change.

The New Delhi policy makers have achieved this same "composition shift".  While they haven't upgraded the public transit system, they have shifted its demographic ridership composition by encouraging more women to ride it.

This is actually a hard mathematical problem because the probability that a woman rides public transit is a function of whether the average woman rides public transit  So, there are multiple equilibria here.  The "free transit" helps to pick out a new equilibrium.

A good urban economics/development thesis could both study how much ridership increases and how much female quality of life and economic opportunity in New Delhi increases due to the "strength in numbers".

An interesting interplay between the demand elasticity parameters arises.  The more price responsive are women to using public transit, then the larger will be the composition shift.  The net increase in female benefits from this policy will be an increasing function of the price elasticity and the bandwaggon elasticity.

Now, throughout this piece I have ignored male behavior.  Will men ride public transit more or less as more women are riding the system?

I am stunned and deeply saddened by the news that my friend and colleague Professor Mark Kleiman has passed away.  Mark was a brilliant man and a highly influential urban policy scholar.  Here is his Google Scholar page.     The last time I met him was at NYU after I had talked about my 2016 China book and had the opportunity to have dinner with him, Paul Romer and Brandon Fuller.  As usual, Mark was honest, tough and brilliant.  I had a great time.

During our years together on the UCLA Public Policy faculty, I always learned from him.  He knew that I was a "Chicago trained guy".  Mark studied economics as a young man and during his years on the Kennedy School faculty and during his time in government he interacted with many economists.   He knew how we think.

He invited me to participate in his Same Facts blog.   Here is a post of his from March 12th 2019.
While many commentators on this blog didn't appreciate my perspective, he always encouraged me to participate and he read and commented on my posts with his usual inquisitive and sharp mind. 

His 2009 Princeton Press book merits special notice.  This important book provided a novel perspective on how to change the "rules of the game" to deter crime. 

He was a straight shooter and a deeply caring man.  I will miss him.