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Regional Labor Markets: The Relationship Between Industry Level Employment and In-commuting in Pennsylvania Counties

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  • Shields, Martin
  • Swenson, David
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    Abstract

    Hoping to generate employment opportunities for residents, communities often offer location incentives to businesses. But many newly created jobs may go to commuters rather than local residents, resulting in higher incentive costs per local job than perhaps anticipated. In this paper we examine the allocation of employment across space, emphasizing the propensity of commuters to “capture†jobs. Central to our work is an industry-level model of incommuting, where commuters balance employment and wage opportunities with relative housing prices and travel costs. Using data from 65 Pennsylvania counties, our empirical results suggest that the proportion of jobs filled by in-commuters varies by industry, ranging from 0.036 (farming) to 0.498 (federal government). Thus communities courting employers should recognize that local benefits of employment growth might depend on the industry. Furthermore, when recruiting industries where there is a high propensity to commute, communities should pursue regional agreements when offering incentives so as to internalize some of the spillover effects.

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    Bibliographic Info

    Article provided by Mid-Continent Regional Science Association in its journal Journal of Regional Analysis and Policy.

    Volume (Year): 30 (2000)
    Issue (Month): 2 ()
    Pages:

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    Handle: RePEc:ags:jrapmc:132179

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    Related research

    Keywords: Industrial Organization; Labor and Human Capital;

    References

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    1. Fields, Gary S, 1976. "Labor Force Migration, Unemployment and Job Turnover," The Review of Economics and Statistics, MIT Press, vol. 58(4), pages 407-15, November.
    2. Hamilton, Bruce W, 1982. "Wasteful Commuting," Journal of Political Economy, University of Chicago Press, vol. 90(5), pages 1035-51, October.
    3. Treyz, George I, et al, 1993. "The Dynamics of U.S. Internal Migration," The Review of Economics and Statistics, MIT Press, vol. 75(2), pages 209-14, May.
    4. Jackman, Richard & Savouri, Savvas, 1992. "Regional Migration versus Regional Commuting: The Identification of Housing and Employment Flows," Scottish Journal of Political Economy, Scottish Economic Society, vol. 39(3), pages 272-87, August.
    5. Smith, Donald Mitchell, 1974. "Regional Growth: Interstate and Intersectoral Factor Reallocations," The Review of Economics and Statistics, MIT Press, vol. 56(3), pages 353-59, August.
    6. Greenwood, Michael J, 1975. "Research on Internal Migration in the United States: A Survey," Journal of Economic Literature, American Economic Association, vol. 13(2), pages 397-433, June.
    7. Richard Jackman & S Savouri, 1992. "Regional Migration versus Regional Commuting: The Identification of Housing and Employment Flows," CEP Discussion Papers dp0057, Centre for Economic Performance, LSE.
    8. Knapp, Thomas A. & Graves, Philip E., 1989. "On the role of amenities in models of migration and regional development," MPRA Paper 19914, University Library of Munich, Germany.
    9. Simpson, Wayne, 1980. "A simultaneous model of workplace and residential location incorporating job search," Journal of Urban Economics, Elsevier, vol. 8(3), pages 330-349, November.
    10. Greenwood, Michael J & Hunt, Gary L, 1984. "Migration and Interregional Employment Redistribution in the United States," American Economic Review, American Economic Association, vol. 74(5), pages 957-69, December.
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