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Agglomeration, Labor Supply, and the Urban Rat Race

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Abstract

This paper establishes the existence of a previously overlooked relationship between agglomeration and hours worked. Among non-professionals, hours worked decrease with the density of workers in the same occupation. Among professionals, a positive relationship is found. This relationship is twice as strong for the young as for the middle-aged. Moreover, young professional hours worked are shown to be especially sensitive to the presence of rivals. We show that these patterns are consistent with the selection of hard workers into cities and the high productivity of agglomerated labor. The behavior of young professionals is also consistent with the presence of keen rivalry in larger markets, a kind of urban rat race. This evidence of a rat race is nearly unique in the literature.

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File URL: http://www.maxwell.syr.edu/uploadedFiles/cpr/publications/working_papers2/wp57.pdf
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Paper provided by Center for Policy Research, Maxwell School, Syracuse University in its series Center for Policy Research Working Papers with number 57.

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Length: 37 pages
Date of creation: Sep 2003
Date of revision:
Handle: RePEc:max:cprwps:57

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  3. Stuart S. Rosenthal & William C. Strange, 2003. "Geography, Industrial Organization, and Agglomeration," Center for Policy Research Working Papers 56, Center for Policy Research, Maxwell School, Syracuse University.
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  17. Linda A. Bell & Richard B. Freeman, 2000. "The Incentive for Working Hard: Explaining Hours Worked Differences in the U.S. and Germany," NBER Working Papers 8051, National Bureau of Economic Research, Inc.
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