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Cities, skills, and inequality

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  • Christopher H. Wheeler

Abstract

The surge in U.S. wage inequality over the past several decades is now commonly attributed to an increase in the returns paid to skill. Although theories differ with respect to why, specifically, this increase has come about, many agree that it is strongly tied to the increase in the relative supply of skilled (i.e. highly educated) workers in the U.S. labor market. A greater supply of skilled labor, for example, may have induced skill-biased technological change or generated greater stratification of workers by skill across firms or jobs. Given that metropolitan areas in the U.S. have long possessed more educated populations than non-metropolitan areas, these theories suggest that the rise in both the returns to skill and wage inequality should have been particularly pronounced in cities. Evidence from the U.S. Census over the period 1950 to 1990 supports both implications.

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  • Christopher H. Wheeler, 2004. "Cities, skills, and inequality," Working Papers 2004-020, Federal Reserve Bank of St. Louis.
  • Handle: RePEc:fip:fedlwp:2004-020
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    Cited by:

    1. Mark Frank, 2009. "Income Inequality, Human Capital, and Income Growth: Evidence from a State-Level VAR Analysis," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 37(2), pages 173-185, June.
    2. Neil Lee & Andrés Rodríguez-Pose, 2013. "Innovation and spatial inequality in Europe and USA," Journal of Economic Geography, Oxford University Press, vol. 13(1), pages 1-22, January.
    3. Up Lim & Ye Choi & Heonyoung Lee, 2015. "Occupational skills and the gender wage gap in Seoul, Korea: a multilevel approach," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 55(2), pages 335-356, December.
    4. Bracalente, Bruno & Perugini, Cristiano & Pompei, Fabrizio, 2008. "What Sorts of Agglomerations Really Matter to Productivity?: A Regional Analysis of Europe's Manufacturing Sector," The Review of Regional Studies, Southern Regional Science Association, vol. 38(2), pages 145-172.
    5. Argentino Pessoa, 2014. "Smart Specialisation in the EU: Is it a Bridge between Innovation and Cohesion?," ERSA conference papers ersa14p989, European Regional Science Association.
    6. Wen-Chi Liao, 2005. "Outsourcing, Inequality, and Cities," 2005 Meeting Papers 904, Society for Economic Dynamics.
    7. Sébastien Breau & Dieter F. Kogler & Kenyon C. Bolton, 2014. "On the Relationship between Innovation and Wage Inequality: New Evidence from Canadian Cities," Economic Geography, Clark University, vol. 90(4), pages 351-373, October.
    8. Edward L. Glaeser & Matthew G. Resseger & Kristina Tobio, 2008. "Urban Inequality," NBER Working Papers 14419, National Bureau of Economic Research, Inc.
    9. Argentino Pessoa, 2016. "Rectracted: Smart specialization in the EU: RIS3 conditionality, innovation and cohesion," Papers in Regional Science, Wiley Blackwell, vol. 95(2), pages 439-439, June.

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    Keywords

    Wages ; Regional economics;

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