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Market Thickness and the Early Labor Market Career of University Graduates- An urban advantage?

Author

Listed:
  • Ahlin, Lina

    () (CIRCLE, Lund University)

  • Andersson, Martin

    () (CIRCLE, Lund University)

  • Thulin, Per

    () (Royal Institute of Technology and Swedish Entrepreneurship Forum)

Abstract

We analyze the influence of market thickness for skills on initial wages and subsequent wage development of university graduates. Using Swedish micro-level panel data on a cohort of graduates, we show that two out of three graduates move to large cities upon graduation. Large cities yield higher rewards to human capital and a stronger early job market career. The premium on initial wages for urban graduates is in the interval of 6-12 percent, and we estimate a wage-growth premium of about 3 percent. Thicker markets for skills appear as a key reason for the concentration of university graduates to larger cities.

Suggested Citation

  • Ahlin, Lina & Andersson, Martin & Thulin, Per, 2013. "Market Thickness and the Early Labor Market Career of University Graduates- An urban advantage?," Papers in Innovation Studies 2013/2, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
  • Handle: RePEc:hhs:lucirc:2013_002
    as

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    File URL: http://wp.circle.lu.se/upload/CIRCLE/workingpapers/201302_Ahlin_et_al.pdf
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    Citations

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    Cited by:

    1. Fredrik Carlsen & Jorn Rattso & Hildegunn E. Stokke, 2013. "Education, experience and dynamic urban wage premium," Working Paper Series 15213, Department of Economics, Norwegian University of Science and Technology.
    2. Andersson, Martin & Henrekson, Magnus, 2014. "Local Competitiveness Fostered through Local Institutions for Entrepreneurship," Working Paper Series 1020, Research Institute of Industrial Economics.
    3. Larsson, Johan P & Wennberg, Karl & Wiklund, Johan & Wright, Mike, 2017. "Location Choices of Graduate Entrepreneurs," Ratio Working Papers 290, The Ratio Institute.

    More about this item

    Keywords

    human capital; university graduates; urban wage premium; market thickness; matching; agglomeration economies; migration; job switching;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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