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Accounting for Big City Growth in Low Paid Occupations: Immigration and/or Service Class Consumption

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  • Ian Gordon
  • Ioannis Kaplanis
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    Abstract

    Growth of 'global cities' in the 1980s was supposed to have involved an occupational polarisation, including growth of low paid service jobs. Though held to be untrue for European cities, at the time, some such growth did emerge in London a decade later than first reported for New York. The question is whether there was simply a delay before London conformed to the global city model, or whether another distinct cause was at work in both cases. This paper proposes that the critical factor in both cases was actually an upsurge of immigration from poor countries providing an elastic supply of cheap labour. This hypothesis and its counterpart based on growth in elite jobs are tested econometrically for the British case with regional data spanning 1975-2008, finding some support for both effects, but with immigration from poor countries as the crucial influence in late 1990s London.

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    Bibliographic Info

    Paper provided by Spatial Economics Research Centre, LSE in its series SERC Discussion Papers with number 0106.

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    Date of creation: Apr 2012
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    Handle: RePEc:cep:sercdp:0106

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    Web page: http://www.spatialeconomics.ac.uk/SERC/publications/default.asp

    Related research

    Keywords: regional labour markets; wages; employment; international migration; consumer demand;

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    1. Maarten Goos & Alan Manning, 2007. "Lousy and Lovely Jobs: The Rising Polarization of Work in Britain," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 118-133, February.
    2. Francesca Mazzolari & Giuseppe Ragusa, 2013. "Spillovers from High-Skill Consumption to Low-Skill Labor Markets," The Review of Economics and Statistics, MIT Press, vol. 95(1), pages 74-86, March.
    3. Hatton, Timothy J & Massimiliano Tani, 2003. "Immigration and Inter-Regional Mobility in the UK, 1982-2000," Royal Economic Society Annual Conference 2003 101, Royal Economic Society.
    4. Tommaso Frattini, 2012. "Immigrazione," Rivista di Politica Economica, SIPI Spa, issue 3, pages 363-407, July-Sept.
    5. Christian Dustmann & Albrecht Glitz & Tommaso Frattini, 2008. "The Labour Market Impact of Immigration," CReAM Discussion Paper Series 0811, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
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    Cited by:
    1. Julie Fry, 2014. "Migration and Macroeconomic Performance in New Zealand: Theory and Evidence," Treasury Working Paper Series 14/10, New Zealand Treasury.

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