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Dynamic agglomeration effects of foreigners and natives – The role of experience in high-quality sectors, tasks and establishments

Author

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  • Niebuhr, Annekatrin
  • Peters, Jan Cornelius
  • Roth, Duncan H.W.

Abstract

We analyze whether the benefits of work experience that was acquired in denser locations can be explained by the quality of jobs that can be found in agglomerations using administrative data on individual employment biographies of workers in Germany. We find that 79% of the premium for work experience gained in the densest regions can be ascribed to the sectors, tasks and establishments in which experience was acquired. Moreover, we find that foreign and native workers, on average, benefit to a similar extent from dynamic agglomeration effects. However, low-skilled foreign workers receive a lower return to experience gained in dense regions than observationally identical natives. This difference can be explained by the fact that the former gain work experience in lower-quality jobs.

Suggested Citation

  • Niebuhr, Annekatrin & Peters, Jan Cornelius & Roth, Duncan H.W., 2024. "Dynamic agglomeration effects of foreigners and natives – The role of experience in high-quality sectors, tasks and establishments," Regional Science and Urban Economics, Elsevier, vol. 108(C).
    • Handle: RePEc:eee:regeco:v:108:y:2024:i:c:s0166046224000711
    DOI: 10.1016/j.regsciurbeco.2024.104040
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    Keywords

    Dynamic agglomeration effects; Ethnic inequality; Job quality; Learning; Work experience;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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