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Amenity Decomposition: The Role Played by Firms and Workers in Explaining Spatial Wage Differences in Chile
Author(s) -
Iturra Victor
Publication year - 2018
Publication title -
tijdschrift voor economische en sociale geografie
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.766
H-Index - 55
eISSN - 1467-9663
pISSN - 0040-747X
DOI - 10.1111/tesg.12311
Subject(s) - economies of agglomeration , amenity , wage , productivity , economics , labour economics , economic geography , decomposition , economic growth , ecology , finance , biology
Abstract It is well established in the literature that amenities are important in affecting regional patterns by influencing both workers' and firms' location decisions. Using the seminal contribution made by Beeson and Eberts, this study performs a wage change decomposition into amenity (workers) and productivity (firms) components. The results reveal that firms are more significant when explaining high average wage regions in Chile, since they derive more benefits from agglomeration economies and natural resources. Finally, the results also confirm how important agglomeration economies are in developing countries.