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The attenuation of human capital spillovers

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Author Info
Rosenthal, Stuart S.
Strange, William C.

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Abstract

This paper uses 2000 Census data to estimate the relationship of agglomeration and proximity to human capital to wages. The paper takes a geographic approach, and focuses on the attenuation of agglomeration and human capital effects. Differencing and instrumental variable methods are employed to address endogeneity in the wage-agglomeration relationship and also to deal with measurement error in our agglomeration and human capital variables. Three key results are obtained. First, the spatial concentration of employment within five miles is positively related to wage. Second, the benefits of spatial concentration are driven by proximity to college educated workers, an instance of human capital spillovers. Third, these effects attenuate sharply with distance.

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File URL: http://www.sciencedirect.com/science/article/B6WMG-4S0202S-1/2/67a768a62d76b17a56ba524c5a8604e5
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Publisher Info
Article provided by Elsevier in its journal Journal of Urban Economics.

Volume (Year): 64 (2008)
Issue (Month): 2 (September)
Pages: 373-389
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Handle: RePEc:eee:juecon:v:64:y:2008:i:2:p:373-389

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Web page: http://www.elsevier.com/locate/inca/622905

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Related research
Keywords: Agglomeration Human capital spillovers Wages;

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  1. Gibson, John & McKenzie, David, 2007. "Using the global positioning system in household surveys for better economics and better policy," Policy Research Working Paper Series 4195, The World Bank. [Downloadable!]
  2. Shihe Fu & Stephen L. Ross, 2007. "Wage Premia in Employment Clusters: Agglomeration Economies or Worker Heterogeneity?," Working papers 2007-26, University of Connecticut, Department of Economics, revised Dec 2007. [Downloadable!]
  3. Richard Harris & Victoria Kravtsova, 2009. "In Search of W," SERC Discussion Papers 0017, Spatial Economics Research Centre, LSE. [Downloadable!]
  4. Beckstead, Desmond & Brown, W. Mark & Newbold, Bruce, 2008. "Cities and Growth: In Situ Versus Migratory Human Capital Growth," The Canadian Economy in Transition 2008019e, Statistics Canada, Economic Analysis Division. [Downloadable!]
  5. Patacchini, Eleonora & Zenou, Yves, 2008. "Ethnic Networks and Employment Outcomes," IZA Discussion Papers 3331, Institute for the Study of Labor (IZA). [Downloadable!]
  6. Sabrina Di Addario & Eleonora Patacchini, 2007. "Wages and the City. Evidence from Italy," Development Working Papers 231, Centro Studi Luca d\'Agliano, University of Milano. [Downloadable!]
    Other versions:
  7. Stuart S. Rosenthal & William C. Strange, 2007. "Small Establishments/Big Effects: Agglomeration, Industrial Organization and Entrepreneurship," NBER Chapters, in: The Economics of Agglomeration National Bureau of Economic Research, Inc. [Downloadable!]
  8. Lehmer, Florian & Ludsteck, Johannes, 2008. "The returns to job mobility and inter-regional migration," IAB Discussion Paper 200806, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]. [Downloadable!]
  9. Edward L. Glaeser & Joseph Gyourko & Albert Saiz, 2008. "Housing Supply and Housing Bubbles," NBER Working Papers 14193, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  10. John C. Haltiwanger & Ron S. Jarmin & C. J. Krizan, 2009. "Mom-and-Pop Meet Big-Box: Complements or Substitutes?," NBER Working Papers 15348, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  11. Marius BRÜLHART & Federica SBERGAMI, 2008. "Agglomeration and Growth : Cross-Country Evidence," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 08.04, Université de Lausanne, Faculté des HEC, DEEP. [Downloadable!]
    Other versions:
  12. Patacchini, Eleonora & Zenou, Yves, 2007. "Ethnicity and Spatial Externalities in Crime," CEPR Discussion Papers 6130, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  13. Cainelli, Giulio & Lupi, Claudio, 2008. "Does Spatial Proximity Matter? Micro-evidence from Italy," Economics & Statistics Discussion Papers esdp08042, University of Molise, Dept. SEGeS. [Downloadable!]
  14. Blomquist, Glenn C. & Coomes, Paul A. & Jepsen, Christopher & Koford, Brandon C. & Troske, Kenneth, 2009. "Estimating the Social Value of Higher Education: Willingness to Pay for Community and Technical Colleges," IZA Discussion Papers 4086, Institute for the Study of Labor (IZA). [Downloadable!]
  15. Edward L. Glaeser & Joshua D. Gottlieb, 2009. "The Wealth of Cities: Agglomeration Economies and Spatial Equilibrium in the United States," NBER Working Papers 14806, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  16. Christopher H. Wheeler & Elizabeth A. La Jeunesse, 2006. "Trends in the distributions of income and human capital within metropolitan areas: 1980-2000," Working Papers 2006-055, Federal Reserve Bank of St. Louis. [Downloadable!]
  17. Daniel F. Heuermann, 2009. "Reinventing the Skilled Region: Human Capital Externalities and Industrial Change," Discussion Papers 200902, Institute of Labour Law and Industrial Relations in the European Community (IAAEG). [Downloadable!]
  18. Shawn Kantor & Alexander Whalley, 2009. "Do Universities Generate Agglomeration Spillovers? Evidence from Endowment Value Shocks," NBER Working Papers 15299, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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