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Trade, Location, and Wages in the United States

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Author Info
Thijs Knaap () (Utrecht School of Economics)

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Abstract

This paper estimates a spatial wage structure for the United States. I employ the market-access and supplier-access method of Redding and Venables (2004), where access is determined using interstate trade data. Economic geography models predict that state-level wages are correlated to this measure, owing to higher levels of demand and better availability of intermediate goods in easily accessible regions. After correcting for omitted-variable bias with exogenous (first nature) regressors and using the appropriate instruments, I find that the explanatory power of access-variables is weak in this dataset.

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Publisher Info
Paper provided by Utrecht School of Economics in its series Working Papers with number 05-30.

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Length: 28 pages
Date of creation: Jul 2005
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Handle: RePEc:use:tkiwps:0530

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Related research
Keywords: Spatial wage structure United States Economic Geography

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Find related papers by JEL classification:
R30 - Urban, Rural, and Regional Economics - - Production Analysis and Firm Location - - - General
J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies

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References listed on IDEAS
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.:
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  2. Overman, Henry G. & Redding, Stephen J & Venables, Anthony J., 2001. "The Economic Geography of Trade Production and Income: A Survey of Empirics," CEPR Discussion Papers 2978, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  3. Steven Brakman & Harry Garretsen & Marc Schramm, 2004. "The strategic bombing of German cities during World War II and its impact on city growth," Journal of Economic Geography, Oxford University Press, vol. 4(2), pages 201-218, April.
  4. McCallum, John, 1995. "National Borders Matter: Canada-U.S. Regional Trade Patterns," American Economic Review, American Economic Association, vol. 85(3), pages 615-23, June. [Downloadable!] (restricted)
  5. Mion, Giordano, 2004. "Spatial externalities and empirical analysis: the case of Italy," Journal of Urban Economics, Elsevier, vol. 56(1), pages 97-118, July. [Downloadable!] (restricted)
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  6. Redding, Stephen & Venables, Anthony J., 2004. "Economic geography and international inequality," Journal of International Economics, Elsevier, vol. 62(1), pages 53-82, January. [Downloadable!] (restricted)
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  7. Bernard Fingleton, 2005. "Testing the 'new economic geography': a comparative analysis based on EU regional data," Urban/Regional 0504003, EconWPA. [Downloadable!]
  8. Michael Roos, . "Wages and Market Potential in Germany," Discussion Papers in Economics 00_09, University of Dortmund, Department of Economics. [Downloadable!]
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  12. Choi, E Kwan & Harrigan, James, 2004. "Handbook of International Trade," Staff General Research Papers 11375, Iowa State University, Department of Economics.
  13. repec:fth:michin:382 is not listed on IDEAS
  14. Alan V. Deardorff, 1995. "Determinants of Bilateral Trade: Does Gravity Work in a Neoclassical World?," NBER Working Papers 5377, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  15. Glenn Ellison & Edward L. Glaeser, 1999. "The Geographic Concentration of Industry: Does Natural Advantage Explain Agglomeration?," American Economic Review, American Economic Association, vol. 89(2), pages 311-316, May. [Downloadable!] (restricted)
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  16. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June. [Downloadable!] (restricted)
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  17. Pierre-Philippe Combes & Henry G. Overman, 2003. "The Spatial Distribution of Economic Activities in the European Union," CEP Discussion Papers dp0587, Centre for Economic Performance, LSE. [Downloadable!]
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  18. Venables, Anthony J, 1996. "Equilibrium Locations of Vertically Linked Industries," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(2), pages 341-59, May.
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  19. H. Hanson, Gordon, 2005. "Market potential, increasing returns and geographic concentration," Journal of International Economics, Elsevier, vol. 67(1), pages 1-24, September. [Downloadable!] (restricted)
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Cited by:
(explanations, 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.)

  1. Gustavsson, Magnus & Jordahl, Henrik, 2006. "Inequality and Trust in Sweden: Some Inequalities are More Harmful than Others," Ratio Working Papers 106, The Ratio Institute. [Downloadable!]
    Other versions:
  2. Gustavsson, Magnus & Jordahl, Henrik, 2006. "Inequality and Trust: Some Inequalities are More Harmful than Others," Working Paper Series 2006:3, Uppsala University, Department of Economics. [Downloadable!]
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