Graduate migration, self-selection and urban wage premiums across the regional hierarchy

Kent Eliasson () and Olle Westerlund ()
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Kent Eliasson: Umeå School of Business, Economics and Statistics, Swedish Agency for Growth Policy Analysis, https://www.umu.se/handelshogskolan

No 962, Umeå Economic Studies from Umeå University, Department of Economics

Abstract: We use Swedish longitudinal population register data on university graduates and estimate the effect of migration on earnings. Migration between regional labour markets is used to identify static and dynamic agglomeration effects on earnings. Heterogeneity in effects is examined by individuals’ position in the ability distribution and by origin-destination size categories of regional labour markets. The results indicate that the effect of upward migration (from smaller to larger labour markets) on earnings is positive throughout. Downward migration (from larger to smaller labour markets) is generally associated with negative or no convincing signs of positive effects on earnings. The estimates indicate positive short-term urban wage premiums (UWP) for all origin-destination flows of upward migration, especially high UWP for in-migration to the Stockholm labour market region. The UWP of upward migration is positive also for movers in the lower end of the ability distribution, but it is substantially higher for high ability migrants. We also find evidence of a positive dynamic UWP of migration to Stockholm from the other regions, particularly for high ability migrants.

Keywords: Urban wage premium; human capital; migration; agglomeration economies; ability (search for similar items in EconPapers)
JEL-codes: J24 J61 R10 R12 R23 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2019-10-17
New Economics Papers: this item is included in nep-geo, nep-lab, nep-mig and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:umnees:0962

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