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Industry localisation and earnings inequality: Evidence from U.S. manufacturing

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  • Wheeler, Christopher H.

Abstract

While the productivity gains associated with the geographic concentration of industry (i.e., localisation) are by now well†documented, little work has considered how those gains are distributed across individual workers. This article offers evidence on the connection between total employment and the relative wage earnings of high†and low†skill workers (i.e., inequality) within two†digit manufacturing industries across the states, and a collection of metropolitan areas in the U.S. between 1970 and 1990. Using measures of overall, between†education†group and residual inequality, I find that wage dispersion falls significantly as industry employment expands.

Suggested Citation

Handle: RePEc:eee:paresc:v:86:y:2007:i:1:p:77-100
DOI: 10.1111/j.1435-5957.2007.00107.x
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JEL classification:

  • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
  • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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