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The return to big-city experience: Evidence from refugees in Denmark

Fabian Eckert, Mads Hejlesen and Conor Walsh

Journal of Urban Economics, 2022, vol. 130, issue C

Abstract: We offer causal evidence of higher returns to experience in big cities. Exploiting a natural experiment that settled refugees across labor markets in Denmark between 1986 and 1998, we find that refugees initially earned similar wages across locations. However, those placed in Copenhagen exhibited 35% faster wage growth with each additional year of experience. Faster sorting of workers toward the type of establishments, occupations, and industries typically found in cities accounts for the vast majority of this urban wage-growth premium.

Keywords: Agglomeration economies; City size; Earnings premium (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:eee:juecon:v:130:y:2022:i:c:s0094119022000316

DOI: 10.1016/j.jue.2022.103454

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