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Local labor market size and qualification mismatch

Francesco Berlingieri ()

No 17-055, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: This paper investigates the effect of the size of the local labor market on skill mismatch. Using survey data for Germany, I find that workers in large cities are both less likely to be overqualified for their job and to work in a different field than the one they are trained for. Different empirical strategies are employed to account for the potential sorting of talented workers into more urbanized areas. Results on individuals never moving from the place of childhood and fixed-effects estimates obtaining identification through regional migrants suggest that sorting does not fully explain the existing differences in qualification mismatch across areas. This provides evidence of the existence of agglomeration economies through better matches. However, lower qualification mismatch in larger cities is found to explain only a small part of the urban wage premium.

Keywords: agglomeration; labor matching; qualification mismatch; urban wage (search for similar items in EconPapers)
JEL-codes: I21 J24 J31 R23 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eur, nep-geo, nep-lma and nep-ure
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:17055

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