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On the Relationship between Innovation and Wage Inequality: New Evidence from Canadian Cities

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  • Sébastien Breau
  • Dieter F. Kogler
  • Kenyon C. Bolton

Abstract

In this article, we examine the link between innovation and earnings inequality across Canadian cities over the 1996–2006 period. We do so using a novel data set that combines information from the Canadian long-form census and the United States Patent and Trademark Office. The analysis reveals that there is a positive relationship between innovation and inequality: cities with higher levels of innovation have more unequal distributions of earnings. Other factors influencing differences in inequality include city size, manufacturing and government employment, the percentage of visible minority in an urban population, and educational inequality. These results are robust to the use of different measures of inequality, innovation, alternative specifications, and instrumental variables estimations. Questions are thus raised about how the benefits of innovation are distributed in society and the long-term sustainability of such trends.

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  • Sébastien Breau & Dieter F. Kogler & Kenyon C. Bolton, 2014. "On the Relationship between Innovation and Wage Inequality: New Evidence from Canadian Cities," Economic Geography, Clark University, vol. 90(4), pages 351-373, October.
  • Handle: RePEc:bla:ecgeog:v:90:y:2014:i:4:p:351-373
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    File URL: http://hdl.handle.net/10.1111/ecge.12056
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    1. repec:oup:cjrecs:v:10:y:2017:i:3:p:383-390. is not listed on IDEAS
    2. Neil Lee & Andrés Rodríguez-Pose, 2016. "Is there trickle-down from tech? Poverty, employment and the high-technology multiplier in US cities," Papers in Evolutionary Economic Geography (PEEG) 1618, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Aug 2016.
    3. Neil Lee & Paul Sissons, 2016. "Inclusive growth? The relationship between economic growth and poverty in British cities," Environment and Planning A, , vol. 48(11), pages 2317-2339, November.
    4. Thomas Kemeny & Taner Osman, 2018. "The Wider Impacts of High-Technology Employment: Evidence from U.S. Cities," Working Papers 89, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research.
    5. repec:taf:regstd:v:50:y:2016:i:10:p:1714-1727 is not listed on IDEAS
    6. Neil Lee & Paul Sissons & Katy Jones, 2016. "The Geography of Wage Inequality in British Cities," Regional Studies, Taylor & Francis Journals, vol. 50(10), pages 1714-1727, October.

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