Residential Location, Job Location, and Wages: Theory and Empirics
AbstractI develop a stylized partial on-the-job equilibrium search model which incorporate a spatial dimension. Workers reside on a circle and can move at a cost. Each point on the circle has a wage distribution. Implications about wages and job mobility are drawn from the model and tested on Danish matched employer-employee data. The model predictions hold true. I find that workers working farther away from their residence earn higher wages. When a worker is making a job-to-job transition where he changes workplace location he experiences a higher wage change than a worker making a job-to-job transition without changing workplace location. However, workers making a job-to-job transition which makes the workplace location closer to the residence experiences a wage drop. Furthermore, low wage workers and workers with high transportation costs are more likely to make job-to-job transitions, but also residential moves.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by School of Economics and Management, University of Aarhus in its series Economics Working Papers with number 2010-14.
Date of creation: 27 Aug 2010
Date of revision:
Contact details of provider:
Web page: http://www.econ.au.dk/afn/
ob mobility; residential mobility; wage dynamics; search;
Find related papers by JEL classification:
- J6 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies
- J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
- R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Production Analysis, and Firm Location
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-08-28 (All new papers)
- NEP-GEO-2010-08-28 (Economic Geography)
- NEP-LAB-2010-08-28 (Labour Economics)
- NEP-URE-2010-08-28 (Urban & Real Estate Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- repec:bla:restud:v:77:y:2010:i:1:p:245-272 is not listed on IDEAS
- Ã‰va NagypÃ¡l, 2006. "On the extent of job-to-job transitions," 2006 Meeting Papers 10, Society for Economic Dynamics.
- Dey, M. S. & Flinn, C. J., 2000.
"An Equilibrium Model of Health Insurance Provision and Wage Determination,"
00-18, C.V. Starr Center for Applied Economics, New York University.
- Matthew S. Dey & Christopher J. Flinn, 2005. "An Equilibrium Model of Health Insurance Provision and Wage Determination," Econometrica, Econometric Society, vol. 73(2), pages 571-627, 03.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.