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Regional Wage Differentials and the Spatial Convergence of Worker Characteristic Prices

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  • Farber, Stephen C
  • Newman, Robert J

Abstract

This paper provides a test for variation in wage structures across regions. The authors suggest that the appropriate test for structural variation incorporates a combination of two lines of research: structural variation and compensating variation. The model of earnings determination used implies that, while job characteristic prices may be subject to stochastic shocks or industry-specific factors and, hence, may differ between regions, the returns to human capital characteristics will be regionally invariant. The results suggest that the theoretical expectations of regional homogeneity is generally supported for the decade of the 1970s. Copyright 1989 by MIT Press.

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  • Farber, Stephen C & Newman, Robert J, 1989. "Regional Wage Differentials and the Spatial Convergence of Worker Characteristic Prices," The Review of Economics and Statistics, MIT Press, vol. 71(2), pages 224-231, May.
    • Handle: RePEc:tpr:restat:v:71:y:1989:i:2:p:224-31
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    Cited by:

    1. François Rycx & Ilan Tojerow, 2004. "Rent sharing and the gender wage gap in Belgium," International Journal of Manpower, Emerald Group Publishing Limited, vol. 25(3/4), pages 279-299, April.
    2. Mark D. Partridge & Dan S. Rickman, 2002. "Did The New Economy Vanquish The Regional Business Cycle?," Contemporary Economic Policy, Western Economic Association International, vol. 20(4), pages 456-469, October.
    3. Vera A. Adamchik & Thomas J. Hyclak, 2013. "The Evolution Of Regional Wage Differentials In A Transition Economy: Evidence From Poland," Global Journal of Business Research, The Institute for Business and Finance Research, vol. 7(5), pages 1-13.
    4. Jean-Guy LORANGER & Gérard BOISMENU, 2010. "A Dynamic Institutional Analysis with a Macroeconomic Model," EcoMod2010 259600107, EcoMod.
    5. Michael Beenstock & Daniel Felsenstein, 2007. "Mobility and Mean Reversion in the Dynamics of Regional Inequality," International Regional Science Review, , vol. 30(4), pages 335-361, October.

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