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Spatial wage disparities: Sorting matters!
Open accessAbstract
Spatial wage disparities can result from spatial differences in the skill composition of the workforce, in non-human endowments, and in local interactions. To distinguish between these explanations, we estimate a model of wage determination across local labour markets using a very large panel of French workers. We control for worker characteristics, worker fixed effects, industry fixed effects, and the characteristics of the local labour market. Our findings suggest that individual skills account for a large fraction of existing spatial wage disparities with strong evidence of spatial sorting by skills. Interaction effects are mostly driven by the local density of employment. Not controlling for worker heterogeneity leads to very biased estimates of interaction effects. Endowments only appear to play a small role.
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Cites
On the mechanics of economic development
Lucas, R. E. (1988) · Journal of Monetary Economics · doi:10.1016/0304-3932(88)90168-7 · Cited by 24,085
Cited by
THE MAGNITUDE AND CAUSES OF AGGLOMERATION ECONOMIES
Puga, D. (2010) · Journal of Regional Science · doi:10.1111/j.1467-9787.2009.00657.x · Cited by 939
Estimating Agglomeration Economies with History, Geology, and Worker Effects
Combes, P.-P., Duranton, G., Gobillon, L., & Roux, S. (2010) · Agglomeration Economics · doi:10.7208/chicago/9780226297927.003.0002 · Cited by 386
Self-citationUnderstanding the City Size Wage Gap
Baum-Snow, N., & Pavan, R. (2012) · The Review of Economic Studies · doi:10.1093/restud/rdr022 · Cited by 355
The identification of agglomeration economies
Combes, P.-P., Duranton, G., & Gobillon, L. (2011) · Journal of Economic Geography · doi:10.1093/jeg/lbq038 · Cited by 341
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Metadata
- Authors
- Combes, P.-P., Duranton, G., & Gobillon, L.
- Venue
- Journal of Urban Economics
- Publisher
- Elsevier BV
- Published
- 2008-03
- Volume
- 63
- Issue
- 2
- Pages
- 723-742
- ISSN
- 0094-1190 (ISSN-L)
- OpenAlex
- W2055758252
- Cited by
- 1,150
- References
- 1
- FWCI
- 119.65
- Type
- journal article
- Language
- en
- Open access
- green
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