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Recalculating... : How Uncertainty in Local Labor Market Definitions Affects Empirical Findings

Author

Listed:
  • Andrew Foote
  • Mark J. Kutzbach
  • Lars Vilhuber

Abstract

This paper evaluates the use of commuting zones as a local labor market definition. We revisit Tolbert and Sizer (1996) and demonstrate the sensitivity of definitions to two features of the methodology: a cluster dissimilarity cutoff, or the count of clusters, and uncertainty in the input data. We show how these features impact empirical estimates using a standard application of commuting zones and an example from related literature. We conclude with advice to researchers on how to demonstrate the robustness of empirical findings to uncertainty in the definition of commuting zones

Suggested Citation

  • Andrew Foote & Mark J. Kutzbach & Lars Vilhuber, 2017. "Recalculating... : How Uncertainty in Local Labor Market Definitions Affects Empirical Findings," Working Papers 17-49, Center for Economic Studies, U.S. Census Bureau.
  • Handle: RePEc:cen:wpaper:17-49
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    File URL: https://www2.census.gov/ces/wp/2017/CES-WP-17-49R.pdf
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    References listed on IDEAS

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    1. Card, David, 2001. "Immigrant Inflows, Native Outflows, and the Local Labor Market Impacts of Higher Immigration," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 22-64, January.
    2. Abigail Wozniak, 2010. "Are College Graduates More Responsive to Distant Labor Market Opportunities?," Journal of Human Resources, University of Wisconsin Press, vol. 45(4), pages 944-970.
    3. David H. Autor & David Dorn & Gordon H. Hanson, 2013. "The China Syndrome: Local Labor Market Effects of Import Competition in the United States," American Economic Review, American Economic Association, vol. 103(6), pages 2121-2168, October.
    4. Michael Amior & Alan Manning, 2018. "The Persistence of Local Joblessness," American Economic Review, American Economic Association, vol. 108(7), pages 1942-1970, July.
    5. Tolbert, Charles M. & Sizer, Molly, 1996. "U.S. Commuting Zones and Labor Market Areas: A 1990 Update," Staff Reports 278812, United States Department of Agriculture, Economic Research Service.
    6. Tolbert, Charles M., II & Killian, Molly Sizer, 1987. "Labor Market Areas for the United States," Staff Reports 277959, United States Department of Agriculture, Economic Research Service.
    7. Yagan, Danny, 2016. "The Enduring Employment Impact of Your Great Recession Location," Institute for Research on Labor and Employment, Working Paper Series qt12d0w9bs, Institute of Industrial Relations, UC Berkeley.
    8. Raj Chetty & Nathaniel Hendren & Patrick Kline & Emmanuel Saez, 2014. "Where is the land of Opportunity? The Geography of Intergenerational Mobility in the United States," The Quarterly Journal of Economics, Oxford University Press, vol. 129(4), pages 1553-1623.
    9. Bound, John & Holzer, Harry J, 2000. "Demand Shifts, Population Adjustments, and Labor Market Outcomes during the 1980s," Journal of Labor Economics, University of Chicago Press, vol. 18(1), pages 20-54, January.
    10. Andrew Foote & Michel Grosz & Ann Stevens, 2019. "Locate Your Nearest Exit: Mass Layoffs and Local Labor Market Response," ILR Review, Cornell University, ILR School, vol. 72(1), pages 101-126, January.
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    Citations

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    Cited by:

    1. Veronica Minaya & Brendan Moore & Judith Scott-Clayton, 2020. "The Effect of Job Displacement on College Enrollment: Evidence from Ohio," NBER Working Papers 27694, National Bureau of Economic Research, Inc.
    2. ADACHI Daisuke & FUKAI Taiyo & KAWAGUCHI Daiji & SAITO Yukiko, 2020. "Commuting Zones in Japan," Discussion papers 20021, Research Institute of Economy, Trade and Industry (RIETI).
    3. Brad Hershbein & Bryan Stuart, 2022. "The Evolution of Local Labor Markets After Recessions," Working Papers 22-16, Federal Reserve Bank of Philadelphia.
    4. Zabek, Mike, 2018. "Local Ties in Spatial Equilibrium," SocArXiv rpq5z, Center for Open Science.
    5. Andrea Batch & Benjamin R. Bridgman & Abe C. Dunn & Mahsa Gholizadeh, 2023. "Consumption Zones," BEA Working Papers 0208, Bureau of Economic Analysis.
    6. Ben Lipsius, 2018. "Labor Market Concentration does not Explain the Falling Labor Share," 2018 Papers pli1202, Job Market Papers.
    7. Jordy Meekes & Wolter H. J. Hassink, 2023. "Endogenous local labour markets, regional aggregation and agglomeration economies," Regional Studies, Taylor & Francis Journals, vol. 57(1), pages 13-25, January.
    8. Christopher S Fowler & Leif Jensen, 2020. "Bridging the gap between geographic concept and the data we have: The case of labor markets in the USA," Environment and Planning A, , vol. 52(7), pages 1395-1414, October.
    9. James Bishop & Emma Greenland, 2021. "Is the Phillips Curve Still a Curve? Evidence from the Regions," RBA Research Discussion Papers rdp2021-09, Reserve Bank of Australia.
    10. Brad J. Hershbein & Bryan A. Stuart, 2020. "Recessions and Local Labor Market Hysteresis," Upjohn Working Papers 20-325, W.E. Upjohn Institute for Employment Research.
    11. Zhang, Whitney, 2022. "Improving commuting zones using the Louvain community detection algorithm," Economics Letters, Elsevier, vol. 219(C).
    12. Jessica H. Brown, 2018. "Does Public Pre-K Have Unintended Consequences on the Child Care Market for Infants and Toddlers?," Working Papers 626, Princeton University, Department of Economics, Industrial Relations Section..

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    More about this item

    Keywords

    Local labor markets; commuting; measurement error; Sensitivity analysis;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques

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