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Co-worker networks, labour mobility, and productivity growth in regions

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  • Balazs Lengyel

    () (Institute of Economics - Centre for Economic and Regional Studies - Hungarian Academy of Sciences)

  • Rikard Eriksson

    () (Department of Geography and Economic History, Umea University)

Abstract

This paper provides a new empirical perspective for analysing the role of social networks for an economic geography approach on regional economic growth by constructing large-scale networks from employee-employee co-occurrences in plants in the entire Swedish economy 1990-2008. We calculate the probability of employee-employee ties at plant level based on homophily-biased random network assumptions and trace the most probable relations of every employee over the full period. Then, we look at the inter-plant ties for the 1995-2008 period because the network is already well developed after five years of edge construction. We argue that these personal acquaintances are important for local learning opportunities and consequently for regional growth. Indeed, the estimated panel Vector Autoregressive models provide the first systematic evidence for a central claim in economic geography: social network density has positive effect on regional productivity growth. The results are robust against removing the old and therefore weak ties from the network. Interestingly, the positive effect of density on growth was found in a segment of the co-worker network as well, in which plants have never been linked by labour mobility previously.

Suggested Citation

  • Balazs Lengyel & Rikard Eriksson, 2015. "Co-worker networks, labour mobility, and productivity growth in regions," IEHAS Discussion Papers 1550, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
  • Handle: RePEc:has:discpr:1550
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    Cited by:

    1. D'Albis, Hippolyte & Boubtane, Ekrame & Coulibaly, Dramane, 2017. "International Migration and Regional Housing Markets: Evidence from France," IZA Discussion Papers 10516, Institute for the Study of Labor (IZA).
    2. Hippolyte D'Albis & Dramane Coulibaly & Ekrame Boubtane, 2017. "International Migration and Regional Housing Markets: Evidence from France," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-01469758, HAL.
    3. Eriksson, Rikard & Rodr�guez-Pose, Andr�s, 2017. "Job-related Mobility and Plant Performance in Sweden," CEPR Discussion Papers 12018, C.E.P.R. Discussion Papers.

    More about this item

    Keywords

    social network; homophily; probability of ties; labour mobility; regional productivity growth; panel vector autoregression;

    JEL classification:

    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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