Wage Premia in Employment Clusters: How Important is Worker Heterogeneity?

Shihe Fu () and Stephen Ross ()

No 2011-027, Working Papers from Human Capital and Economic Opportunity Working Group

Abstract: This paper tests whether the correlation between wages and the spatial concentration of employment can be explained by unobserved worker productivity differences. Residential location is used as a proxy for a worker's unobserved productivity, and average workplace commute time is used to test whether location-based productivity differences are compensated away by longer commutes. Analyses using confidential data from the 2000 Decennial Census Long Form find that the agglomeration estimates are robust to comparisons within residential location and that the estimates do not persist after controlling for commuting costs suggesting that the productivity differences across locations are not due to productivity differences across individuals.

Keywords: Agglomeration; Wages; Sorting; Locational Equilibrium; Human Capital Externalities (search for similar items in EconPapers)
JEL-codes: R13 R30 J24 J31 (search for similar items in EconPapers)
Date: 2010-02
Note: YHC
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed

Downloads: (external link)
http://humcap.uchicago.edu/RePEc/hka/wpaper/Fu_Ros ... remia-employment.pdf First version, February, 2010 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:hka:wpaper:2011-027

Access Statistics for this paper

More papers in Working Papers from Human Capital and Economic Opportunity Working Group
Contact information at EDIRC.
Series data maintained by Jennifer Pachon ().