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Difference in terms of cost-of-living between rural and urban areas is a frequent theoretical analysis in Regional Economics. Lack of routine measures in rural areas does not usually allow to observe changes in rural costs. We adapt the Big Mac index, typically used to measure purchasing power parity between countries, as a potential quick and inexpensive indicator of short-term local price variations. With a national random sample of McDonald's stores repeated in time, we find prices grew slightly faster in rural areas than in urban areas. Spatial transmission of prices seems to be limited to very localized effects, meaning that rural price increases are not due to urban spillover effects. [ABSTRACT FROM AUTHOR]

Since Roback's seminal work (J Polit Econ 90(6):1257-1278, 1982), the literature on hedonic prices has evaluated the role of amenities in equilibrating regional differentials in nominal wages and prices. While these studies generally find evidence for traditional amenities and disamenities in developed countries, there remains little research on how characteristics such as violence affect the equilibrium in less developed countries. This article explores violence and other local characteristics as an amenity or disamenity for Mexico and employs the hedonic wage and rent theory proposed by Roback. This research uses a multilevel estimation technique using data from the Mexican Household Income and Expenditure Survey, along with other information from the municipal and state levels. This article finds evidence to suggest that illegal earning opportunities outweigh crime disamenity by inhabitants of some traditional drug-trafficking regions, because such crime appears to be the modus vivendi in those regions in a way that does not reduce economic performance. [ABSTRACT FROM AUTHOR]

This paper proposes a methodology for a spatial cost index of housing that considers spatial heterogeneity in properties across regions. The index is built by combining three different techniques to reduce the spatial heterogeneity in housing: Quasi-experimental methods, hedonic prices and Fisher spatial price index. Using microdata from the Chilean survey CASEN 2006, it is shown that the quasi-experimental method called Mahalanobis metric within propensity score calipers (MMWPS) leads to a significant reduction in the potential bias. The technique matches dwellings of a particular region with other properties of similar characteristics in the benchmark region (Metropolitan region). Once the houses are matched, a hedonic price model is computed, and a regional housing price matrix is created using Fisher spatial price indices. The paper concludes the existence of price differentials for homogeneous houses across regions in Chile. [ABSTRACT FROM AUTHOR]