Understanding Divergence in the Performance of Central Business District Economies Among U.S. Metropolitan Regions, 1995–2019

Abstract

Although references to an urban resurgence are pervasive, on average, the share of regional jobs found in central business district (CBD) areas has fallen since the 1990s. Yet, this fact masks great variation in the performance of CBD economies. In several metropolitan regions, the share of jobs found in CBD areas increased over this period. This paper seeks to understand the factors that explain such variation. Relying on a panel of metropolitan regions for the period 1995 to 2019, the paper finds that, as a regional economy increasingly comprises tasks that are more cognitive in nature, the share of its jobs found in CBD areas increases. Although the “great divergence” has been linked to an increasing dispersion of incomes, health care outcomes, and cultural identities among regions, the paper's findings suggest it may also be associated with divergent economic performance among CBD areas.