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Human Capital Externalities and the Urban Wage Premium: Two Literatures and their Interrelations

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  • Daniel Heuermann

    (Institute for Labour Law and Industrial Relations in the European Community, the University of Trier, 54286 Trier, Germany, daniel.f.heuermann@gmx.de)

  • Benedikt Halfdanarson

    (Statistics Iceland, National Accounts, Borgartun 21b, Reykjavik, 105, Iceland, benedikt@internet.is)

  • Jens Suedekum

    (Mercator School of Management, University of Duisburg-Essen, Lotharstrasse 65, Duisburg, 47057, Germany, jens.suedekum@uni-due.de)

Abstract

In this paper, a survey is presented of the recent developments in two empirical literatures at the crossroads of labour and urban economics: studies about localised human capital externalities (HCE) and about the urban wage premium (UWP). After surveying the methods and main results of each of these two literatures separately, several interrelations between them are highlighted. In particular, the discussion focuses on whether HCE can be interpreted as one fundamental cause of the UWP and whether one literature can learn conceptually from the other.

Suggested Citation

  • Daniel Heuermann & Benedikt Halfdanarson & Jens Suedekum, 2010. "Human Capital Externalities and the Urban Wage Premium: Two Literatures and their Interrelations," Urban Studies, Urban Studies Journal Limited, vol. 47(4), pages 749-767, April.
  • Handle: RePEc:sae:urbstu:v:47:y:2010:i:4:p:749-767
    DOI: 10.1177/0042098009352363
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    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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