City size, quality of life, and the urbanization deflator of the GNP: 1910-1984.

The authors attempt to determine the net effect of city size on quality of life by developing a welfare measure of urbanization. "The estimation procedure suggested in the theoretical part of the paper (section II) is implemented in the empirical part (section III) using 1980 census data from the [U.S.] PUMS (Public Use Micro Data Sample). The results indicate there is no single optimal city size, but rather a worst city size, and about 90 percent of the U.S. population reside in cities smaller than worst city size. If quality of life is related to the degree of urbanization, then long-term trends in the locational distribution of the population should be accounted for in any welfare-oriented measure of national income. One application of our results is, as indicated, the derivation of a GNP welfare deflator reflecting changes in the degree of urbanization (section IV). The findings suggest an urban deflator on the order of six to seven percentage points, which is steadily increasing at a rate of about half a percentage point per decade." excerpt