Endogenous local labour markets, regional aggregation and agglomeration economies

Jordy Meekes; Wolter Hassink

doi:10.1080/00343404.2022.2050893

Endogenous local labour markets, regional aggregation and agglomeration economies

Jordy Meekes^*, Wolter Hassink

^*Corresponding author for this work

Research output: Contribution to journal › Article › Academic › peer-review

Abstract

We examine the role of spatial unit size in measuring the urban wage premium. Using Dutch administrative data, we define local labour markets (LLMs) based on employees’ commuting outcomes, gender and educational attainment. We show that high-educated employees and male employees have a relatively large LLM. Using a continuum of regional aggregations, we find that urban wage premium estimates increase over the level of aggregation, also for different subgroups of employees. We show that the modifiable areal unit problem (MAUP) does not explain this pattern, consistent with stronger agglomeration externalities at higher regional aggregation levels.

Original language	English
Pages (from-to)	13-25
Number of pages	13
Journal	Regional Studies
Volume	57
Issue number	1
DOIs	https://doi.org/10.1080/00343404.2022.2050893
Publication status	Published - Jan 2023

Bibliographical note

Funding Information:
We thank the seminar participants at the 9th European Meeting of the Urban Economics Association, 2018 SMU Conference on Urban and Regional Economics, the 13th Meeting of the Urban Economics Association, the Microeconomic Studies Function of the Federal Reserve Bank of New York, The University of Melbourne, the 32nd Annual Conference of the European Society for Population Economics, and Utrecht University School of Economics. We also thank Bram van Besouw, Maarten Goos, Henri de Groot, Ross Hickey, Eric Mengus, Jos van Ommeren, Frank van Oort, Roberto Pinheiro, Jørn Rattsø, Vincent Schippers and Coen Teulings for their insightful comments. We also thank Dieter F. Kogler and two anonymous reviewers, whose valuable comments substantially improved the quality of the paper. This article is based on both a chapter in the dissertation of Meekes (2019) and a previous discussion paper (Meekes & Hassink, 2019).

Publisher Copyright:
© 2022 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group.

Keywords

urban wage premium
modifiable areal unit problem (MAUP)
local labour markets
agglomeration
gender
education

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Endogenous local labour markets regional aggregation and agglomeration economiesFinal published version, 2.28 MBLicence: CC BY

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title = "Endogenous local labour markets, regional aggregation and agglomeration economies",

abstract = "We examine the role of spatial unit size in measuring the urban wage premium. Using Dutch administrative data, we define local labour markets (LLMs) based on employees{\textquoteright} commuting outcomes, gender and educational attainment. We show that high-educated employees and male employees have a relatively large LLM. Using a continuum of regional aggregations, we find that urban wage premium estimates increase over the level of aggregation, also for different subgroups of employees. We show that the modifiable areal unit problem (MAUP) does not explain this pattern, consistent with stronger agglomeration externalities at higher regional aggregation levels.",

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Endogenous local labour markets, regional aggregation and agglomeration economies

Abstract

Bibliographical note

Keywords

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