Can regional employment disparities explain the allocation of human capital across space?

Abstract

"This paper examines the determinants of skill-selective regional migration in a context where modelling the migration decision as a wage-maximizing process may be insufficient due to persistent employment disparities. Based on a Borjas-type framework it is shown that high-skilled workers are disproportionately attracted to regions with higher mean wages and employment chances as well as higher regional wage and employment inequalities. Estimates from a labour flow fixed-effects model and a general methods of moments (GMM) estimator show that these predictions hold, but only employment disparities induce a robust and significant skill sorting. The paper thus establishes a missing link about why employment disparities may actually be self-reinforcing." (Author's abstract, IAB-Doku) ((en))

Cite article

Arntz, M., Gregory, T. & Lehmer, F. (2014): Can regional employment disparities explain the allocation of human capital across space? In: Regional Studies. Journal of the Regional Studies Association, Vol. 48, No. 10, p. 1719-1738. DOI:10.1080/00343404.2014.882500