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Spatial wage disparities and the role of spatial labor sorting

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  • Dusan Paredes

    ()
    (IDEAR - Department of Economics, Universidad Católica del Norte - Chile)

Abstract

Spatial wage inequality among Chilean counties reached its peak in 1994, when it represented 19.2% of total wage inequality. By 2009, spatial inequality had decreased to 10.3%. However, when the model included controls on human capital, spatial inequality fell to 6%. This result implies that spatial labor sorting accounts for an average of about 45% of the spatial wage disparity. These findings suggest that policymakers should consider ways to spread human capital throughout the nation as an alternative to reduce spatial inequality.

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File URL: https://sites.google.com/a/ucn.cl/wpeconomia/archivos/WP2012-14.pdf
File Function: First version, 2012
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Bibliographic Info

Paper provided by Universidad Catolica del Norte, Chile, Department of Economics in its series Documentos de Trabajo en Economia y Ciencia Regional with number 28.

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Length: 12 pages
Date of creation: Sep 2012
Date of revision: Sep 2012
Handle: RePEc:cat:dtecon:dt201214

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Related research

Keywords: Spatial income inequality; spatial sorting; multilevel regression.;

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  1. Dusan Paredes Araya & Victor Iturra Rivera, 2013. "Substitution bias and the construction of a spatial cost of living index," Papers in Regional Science, Wiley Blackwell, vol. 92(1), pages 103-117, 03.
  2. López, Ramón & Miller, Sebastian J., 2008. "Chile: The Unbearable Burden of Inequality," World Development, Elsevier, vol. 36(12), pages 2679-2695, December.
  3. Dusan Paredes, 2011. "A methodology to compute regional housing price index using matching estimator methods," The Annals of Regional Science, Springer, vol. 46(1), pages 139-157, February.
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