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Spatial skill concentration agglomeration economies
Author(s) -
Ehrl Philipp,
Monasterio Leonardo
Publication year - 2021
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/jors.12505
Subject(s) - economies of agglomeration , unobservable , endogeneity , externality , economics , instrumental variable , wage , spatial econometrics , panel data , census , sorting , economic geography , labour economics , econometrics , microeconomics , population , demography , sociology , computer science , programming language
Using the Brazilian census and administrative panel data, the present paper provides evidence that the spatial concentration of analytical skills generates positive wage externalities for all workers in the local labor market. We rely on shift‐share instrumental variables to overcome the endogeneity of skill concentrations. The observed externality is independent from the classical market size economies. The estimates are robust to geography, institutions and workers' sorting on unobservable abilities.