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Skills in the city

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Author Info

  • Bacolod, Marigee
  • Blum, Bernardo S.
  • Strange, William C.

Abstract

This paper documents the allocation of skills across cities and estimates the impact of agglomeration on the hedonic prices of worker skills. We find that large cities are more skilled than are small cities, but only to a modest degree. We also show that the increase in productivity associated with agglomeration, as measured by the urban wage premium, is larger for workers with stronger cognitive and people skills. In contrast, motor skills and physical strength are not rewarded to a greater degree in large cities. Urbanization thus enhances thinking and social interaction, rather than physical abilities. These results are robust to a variety of estimation strategies, including using NLSY variables that control for worker quality and a worker-MSA fixed effect specification.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Urban Economics.

Volume (Year): 65 (2009)
Issue (Month): 2 (March)
Pages: 136-153

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Handle: RePEc:eee:juecon:v:65:y:2009:i:2:p:136-153

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

Related research

Keywords: Wages Skill distribution Agglomeration;

References

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  1. Edward L. Glaeser & David C. Mare, 1994. "Cities and Skills," NBER Working Papers 4728, National Bureau of Economic Research, Inc.
  2. Marshall, Alfred, 1890. "The Principles of Economics," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number marshall1890.
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  10. Nicola Persico & Andrew Postlewaite & Dan Silverman, 2001. "The Effect of Adolescent Experience on Labor Market Outcomes: The Case of Height, Third Version," PIER Working Paper Archive 04-013, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 05 Jan 2004.
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  17. James J. Heckman & Jora Stixrud & Sergio Urzua, 2006. "The Effects of Cognitive and Noncognitive Abilities on Labor Market Outcomes and Social Behavior," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 411-482, July.
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  28. Xavier Gabaix, 1999. "Zipf'S Law For Cities: An Explanation," The Quarterly Journal of Economics, MIT Press, vol. 114(3), pages 739-767, August.
  29. Rosenthal, Stuart S. & Strange, William C., 2008. "The attenuation of human capital spillovers," Journal of Urban Economics, Elsevier, vol. 64(2), pages 373-389, September.
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