Regional Wage Differences in the Netherlands: Micro-Evidence on Agglomeration Externalities

Stefan P.T. Groot, Henri de Groot and Martijn Smit
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Stefan P.T. Groot: VU University Amsterdam

No 11-050/3, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: Based on micro-data on individual workers for the period 2000-2005, we show that wage differentials in the Netherlands are small but present. A large part of these differentials can be attributed to individual characteristics of workers. Remaining effects are partially explained by variations in employment density, with an elasticity of about 3.8 percent and by Marshall-Arrow-Romer externalities, where doubling the share of a (2-digit NACE) industry results in a 2.4 percent higher productivity. We find evidence for a negative effect of competition (associated with Porter externalities) and diversity (associated with Jacobs externalities). This discussion paper led to a publication in the Journal of Regional Science .

Keywords: regional labour markets; wage differentials; agglomeration externalities (search for similar items in EconPapers)
JEL-codes: J24 O12 R11 R23 (search for similar items in EconPapers)
Date: 2011-03-07
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Related works:
Journal Article: REGIONAL WAGE DIFFERENCES IN THE NETHERLANDS: MICRO EVIDENCE ON AGGLOMERATION EXTERNALITIES (2014)
Working Paper: Regional wage differences in the Netherlands: Micro-evidence on agglomeration externalities (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20110050

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