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The Employment Advantages of Skilled Urban Areas

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  • Ana Maria DIAZ ESCOBAR

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

Abstract

This paper explores whether the agglomeration of human capital leads to social employment advantages in urban labor markets of a developing country: Colombia. I estimate the social effects of human capital agglomeration by comparing employment opportunities of individuals located in urban areas in which the level of education differs. Results show that employment opportunities are higher on average in skilled urban areas. Three explanations have been offered: human capital externalities, production complementarities, and consumption spillovers. To distinguish between them, I analyze the effect of an increase on the college share on the employment rate for different education groups. Spatial employment differences in Colombia are mostly explained by human capital externalities and production complementarities.

Suggested Citation

  • Ana Maria DIAZ ESCOBAR, 2011. "The Employment Advantages of Skilled Urban Areas," LIDAM Discussion Papers IRES 2011015, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:2011015
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    More about this item

    Keywords

    local labor markets; employment; human capital externalities; production complementarities; consumer demand spillovers; signaling; congestion;
    All these keywords.

    JEL classification:

    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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