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Wage disparities in Britain: people or place?

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  • Gibbons, Stephen
  • Overman, Henry G.
  • Pelkonen, Panu

Abstract

This paper investigates wage disparities across sub-national labour markets in Britain using anewly available microdata set. The findings show that wage disparity across areas is verypersistent over time. While area effects play a role in this wage disparity, most of it is due toindividual characteristics (sorting). Area effects contribute a very small percentage to theoverall variation of wages and so are not very important for understanding overall levels ofwage disparity. Specifically, in our preferred specification area effects explain less than 1of overall wage variation. This share has remained roughly constant over the period 1998-2008.

Suggested Citation

  • Gibbons, Stephen & Overman, Henry G. & Pelkonen, Panu, 2010. "Wage disparities in Britain: people or place?," LSE Research Online Documents on Economics 30845, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:30845
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      by Tyler Cowen in Marginal Revolution on 2011-03-29 20:40:57

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    Cited by:

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    7. Faggio, Giulia & Silva, Olmo, 2014. "Self-employment and entrepreneurship in urban and rural labour markets," Journal of Urban Economics, Elsevier, vol. 84(C), pages 67-85.
    8. Faggio, Giulia & Silva, Olmo, 2012. "Does self-employment measure entrepreneurship? evidence from Great Britain," LSE Research Online Documents on Economics 57919, London School of Economics and Political Science, LSE Library.
    9. Rudiger Ahrend & Emily Farchy & Ioannis Kaplanis & Alexander C. Lembcke, 2015. "What Makes Cities More Productive? Agglomeration Economies and the Role of Urban Governance: Evidence from 5 OECD Countries," SERC Discussion Papers 0178, Centre for Economic Performance, LSE.
    10. Thomas Kemeny, 2013. "Immigrant Diversity and Economic Development in Cities: A Critical Review," SERC Discussion Papers 0149, Centre for Economic Performance, LSE.
    11. Gaure, Simen, 2013. "OLS with multiple high dimensional category variables," Computational Statistics & Data Analysis, Elsevier, vol. 66(C), pages 8-18.
    12. Ipsita Roy & Davide Consoli, 2018. "Employment Polarization in Germany: Role of Technology, Trade and Human Capital," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 61(2), pages 251-279, June.
    13. Neil Lee, 2014. "The Creative Industries and Urban Economic Growth in the UK," Environment and Planning A, , vol. 46(2), pages 455-470, February.
    14. Gibbons, Stephen & Overman, Henry G., 2011. "The future of rural policy: lessons from spatial economics," LSE Research Online Documents on Economics 59234, London School of Economics and Political Science, LSE Library.
    15. Donald R. Davis & Jonathan I. Dingel, 2019. "A Spatial Knowledge Economy," American Economic Review, American Economic Association, vol. 109(1), pages 153-170, January.
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    17. Adriana Duta & Cristina Iannelli, 2018. "Social Class Inequalities in Graduates’ Labour Market Outcomes: The Role of Spatial Job Opportunities," Social Sciences, MDPI, vol. 7(10), pages 1-18, October.
    18. Ahrend, Rudiger & Farchy, Emily & Kaplanis, Ioannis & Lembcke, Alexander C., 2016. "What Makes Cities More Productive? Evidence from 5 OECD Countries on the Role of Urban Governance," Beiträge zur Jahrestagung 2016 (Witten/Herdecke) 175187, Verein für Socialpolitik, Ausschuss für Wirtschaftssysteme und Institutionenökonomik.
    19. Heres, David R. & Jack, Darby & Salon, Deborah, 2013. "Do Public Transit Investments Promote Urban Economic Development? Evidence from Bogotá, Colombia," Institute of Transportation Studies, Working Paper Series qt8dg273pk, Institute of Transportation Studies, UC Davis.
    20. Stefan Groot & Henri de Groot, 2011. "Wage inequality in the Netherlands: Evidence, trends and explanations," CPB Discussion Paper 186, CPB Netherlands Bureau for Economic Policy Analysis.

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    More about this item

    Keywords

    wage; disparities; labour;
    All these keywords.

    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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