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The estimation of urban premium wage using propensity score analysis: some considerations from the spatial perspective

Author

Listed:
  • Dusan Paredes

    (IDEAR - Department of Economics, Universidad Católica del Norte - Chile)

  • Marcelo Lufin

    (IDEAR - Department of Economics, Universidad Católica del Norte - Chile)

  • Patricio Aroca

    (IDEAR - Department of Economics, Universidad Católica del Norte - Chile)

Abstract

This paper estimates the Urban Wage Premium for the Chilean case, but proposing three contributions to the literature. First, the geographical space is reconfigured using functional regions instead administrative regions. This process is carried out using techniques from the spatial econometric literature. Second, we exploit the use of micro data. We estimate the wage equation using a survey at individual level that avoids problems associated with regional aggregated specifications. Finally, we set the comparability among observations using matching comparison. Thus, we isolate the urban effect from other alternative sources. Our results suggest a Urban Wage Premium between 4 and 21%.

Suggested Citation

  • Dusan Paredes & Marcelo Lufin & Patricio Aroca, 2012. "The estimation of urban premium wage using propensity score analysis: some considerations from the spatial perspective," Documentos de Trabajo en Economia y Ciencia Regional 21, Universidad Catolica del Norte, Chile, Department of Economics, revised Apr 2012.
    • Handle: RePEc:cat:dtecon:dt201207
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    References listed on IDEAS

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    More about this item

    Keywords

    Size and Spatial Distributions of Regional Economic Activity;

    JEL classification:

    • 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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