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The impact of agglomeration effects and accessibility on wages

Anna Matas, Josep Raymond () and José Luís Roig ()
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José Luís Roig: Universitat Autònoma de Barcelona, Dpt. Economia Aplicada, Fac. Ciències Econòmiques, Campus de Bellaterra, 08193 Bellaterra, Barcelona.

No XREAP2011-16, Working Papers from Xarxa de Referència en Economia Aplicada (XREAP)

Abstract: This paper contributes to the empirical literature on the effects of agglomeration and road accessibility on productivity of firms by looking at the case of Spain. We approach productivity indirectly by using individual wages allocated at the NUTS III level. We use a repeated cross-section of individual micro-data for the years 1995, 2002 and 2006. The availability of interprovincial travel time data for each of the three years allows controlling for transport improvements over the period by using a market potential variable. Additionally, agglomeration is approached by employment density and we control for localization economies, human capital externalities and a large set of individual and workplace characteristics. Estimating by instrumental variables, our results show a positive and significant effect of market accessibility on wages and non linear effect for employment density.

Pages: 39 pages
Date: 2011-11, Revised 2011-11
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Downloads: (external link) First version, 2011 (application/pdf) Revised version, 2011 (application/pdf)

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