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Wages and Industrial Clusters in Rio Grande do Sul (Brazil)

Leonardo Monasterio

The Review of Regional Studies, 2006, vol. 36, issue 3, 304-23

Abstract: The purpose of this paper is to test whether the New Economic Geography hypothesis concerning the existence of a spatial wage structure applies to the state of Rio Grande do Sul, Brazil. The first part of the study applies several spatial analysis techniques in order to locate industrial clusters and calculate the market potential of the municipalities studied. The second part uses this information together with demographic data to run wage regressions aimed at capturing the effects of agglomeration and urban economies on individual wages. The results do not falsify the hypothesis that nominal wages, using the proper controls, are higher in municipalities with higher market potential and lower in the economically disadvantaged hinterland of the state.

Keywords: Economic Geography; Geography; Municipalities; Spatial; Wage (search for similar items in EconPapers)
JEL-codes: J31 L60 O14 O18 R12 R23 R32 (search for similar items in EconPapers)
Date: 2006
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Handle: RePEc:rre:publsh:v:36:y:2006:i:3:p:304-23