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Expensive and low-price places to live : regional price levels and the agglomeration wage differential in Western Germany

Author

Listed:
  • Blien, Uwe

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Gartner, Hermann
  • Stüber, Heiko
  • Wolf, Katja

Abstract

"Recently, there has been a renewed interest in the agglomeration wage differential. One of the open research question is whether wage differences between large cities and the rural country are due to unobserved differences in regional price levels. In this paper information on regional price levels for western German regions is used to assess this wage differential. Since for many regions price information is not available. Multiple Imputation is used to generate completed data sets. It can be shown that this strategy is more reliable than simply using predictions of regression analysis. The results obtained show that the agglomeration wage differential in Germany is smaller than in the US, and that only a minor part of it can be explained by differences in prices." (Author's abstract, IAB-Doku) ((en))

Suggested Citation

  • Blien, Uwe & Gartner, Hermann & Stüber, Heiko & Wolf, Katja, 2007. "Expensive and low-price places to live : regional price levels and the agglomeration wage differential in Western Germany," IAB-Discussion Paper 200715, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    • Handle: RePEc:iab:iabdpa:200715
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    File URL: https://doku.iab.de/discussionpapers/2007/dp1507.pdf
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    References listed on IDEAS

    as
    1. Glaeser, Edward L & Mare, David C, 2001. "Cities and Skills," Journal of Labor Economics, University of Chicago Press, vol. 19(2), pages 316-342, April.
    2. Yankow, Jeffrey J., 2006. "Why do cities pay more? An empirical examination of some competing theories of the urban wage premium," Journal of Urban Economics, Elsevier, vol. 60(2), pages 139-161, September.
    3. Michael Roos, 2006. "Regional price levels in Germany," Applied Economics, Taylor & Francis Journals, vol. 38(13), pages 1553-1566.
    4. Jens Suedekum, 2006. "Agglomeration And Regional Costs Of Living," Journal of Regional Science, Wiley Blackwell, vol. 46(3), pages 529-543, August.
    5. Moulton, Brent R, 1990. "An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Unit," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 334-338, May.
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    Cited by:

    1. Rupert Kawka, 2010. "Regionale Preisunterschiede in den alten und neuen Ländern," ifo Dresden berichtet, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 17(02), pages 5-16, 04.
    2. Rupert Kawka, 2010. "Regionale Preisunterschiede in den alten und neuen Ländern," ifo Dresden berichtet, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 17(02), pages .5-16, April.

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    More about this item

    Keywords

    Bundesrepublik Deutschland ; Westdeutschland ; Lohnunterschied ; Preisniveau ; regionale Disparität;
    All these keywords.

    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • 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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