IDEAS home Printed from https://ideas.repec.org/a/ucp/jlabec/v19y2001i4p879-99.html
   My bibliography  Save this article

Search, Sorting, and Urban Agglomeration

Author

Listed:
  • Wheeler, Christopher H

Abstract

Studies have suggested that urban agglomeration enhances productivity by facilitating the firm-worker matching process. This article develops a model that formalizes this notion and demonstrates that, when firm capital and worker skill are complementary in production, urban agglomeration will tend to generate more efficient, yet segregated matches. As a result, not only will local market size be positively associated with average productivity, it will also generate greater between-skill-group wage inequality and a higher expected return to skill acquisition. Recent data from the counties and metropolitan areas of the United States is consistent with each of these implications. Copyright 2001 by University of Chicago Press.

Suggested Citation

  • Wheeler, Christopher H, 2001. "Search, Sorting, and Urban Agglomeration," Journal of Labor Economics, University of Chicago Press, vol. 19(4), pages 879-899, October.
    • Handle: RePEc:ucp:jlabec:v:19:y:2001:i:4:p:879-99
    DOI: 10.1086/322823
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/322823
    File Function: full text
    Download Restriction: Access to full text is restricted to subscribers. See http://www.journals.uchicago.edu/JOLE for details.
    File URL: https://libkey.io/10.1086/322823?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gary S. Becker & Kevin M. Murphy, 1994. "The Division of Labor, Coordination Costs, and Knowledge," NBER Chapters, in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, Third Edition, pages 299-322, National Bureau of Economic Research, Inc.
    2. Kremer, M & Maskin, E, 1996. "Wage Inequality and Segregation by Skill," Working papers 96-23, Massachusetts Institute of Technology (MIT), Department of Economics.
    3. Helsley, Robert W. & Strange, William C., 1990. "Matching and agglomeration economies in a system of cities," Regional Science and Urban Economics, Elsevier, vol. 20(2), pages 189-212, September.
    4. Michael Kremer, 1993. "The O-Ring Theory of Economic Development," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 108(3), pages 551-575.
    5. Sattinger, Michael, 1993. "Assignment Models of the Distribution of Earnings," Journal of Economic Literature, American Economic Association, vol. 31(2), pages 831-880, June.
    6. Avinash Dixit, 1973. "The Optimum Factory Town," Bell Journal of Economics, The RAND Corporation, vol. 4(2), pages 637-654, Autumn.
    7. Ciccone, Antonio & Hall, Robert E, 1996. "Productivity and the Density of Economic Activity," American Economic Review, American Economic Association, vol. 86(1), pages 54-70, March.
    8. John M. Quigley, 1998. "Urban Diversity and Economic Growth," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 127-138, Spring.
    9. Glaeser, Edward L & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1992. "Growth in Cities," Journal of Political Economy, University of Chicago Press, vol. 100(6), pages 1126-1152, December.
      • Edward L. Glaeser & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1991. "Growth in Cities," NBER Working Papers 3787, National Bureau of Economic Research, Inc.
      • Glaeser, Edward Ludwig & Kallal, Hedi D. & Scheinkman, Jose A. & Shleifer, Andrei, 1992. "Growth in Cities," Scholarly Articles 3451309, Harvard University Department of Economics.
    10. Robert H. Topel & Michael P. Ward, 1992. "Job Mobility and the Careers of Young Men," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 439-479.
    11. Becker, Gary S, 1973. "A Theory of Marriage: Part I," Journal of Political Economy, University of Chicago Press, vol. 81(4), pages 813-846, July-Aug..
    12. Kenneth R. Troske, 1999. "Evidence On The Employer Size-Wage Premium From Worker-Establishment Matched Data," The Review of Economics and Statistics, MIT Press, vol. 81(1), pages 15-26, February.
    13. Abdel-Rahman, H. M., 1988. "Product differentiation, monopolistic competition and city size," Regional Science and Urban Economics, Elsevier, vol. 18(1), pages 69-86, February.
    14. Henderson, J. Vernon, 1986. "Efficiency of resource usage and city size," Journal of Urban Economics, Elsevier, vol. 19(1), pages 47-70, January.
    15. Joan Vipond, 1974. "City Size and Unemployment," Urban Studies, Urban Studies Journal Limited, vol. 11(1), pages 39-46, February.
    16. Jovanovic, Boyan, 1979. "Job Matching and the Theory of Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 972-990, October.
    17. Alperovich Gershon, 1993. "City Size and the Rate and Duration of Unemployment: Evidence from Israeli Data," Journal of Urban Economics, Elsevier, vol. 34(3), pages 347-357, November.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wheeler, Christopher H., 2006. "Productivity and the geographic concentration of industry: The role of plant scale," Regional Science and Urban Economics, Elsevier, vol. 36(3), pages 313-330, May.
    2. Wheeler, Christopher H., 2008. "Worker turnover, industry localization, and producer size," Journal of Economic Behavior & Organization, Elsevier, vol. 66(2), pages 322-334, May.
    3. Combes, Pierre-Philippe & Duranton, Gilles & Gobillon, Laurent, 2008. "Spatial wage disparities: Sorting matters!," Journal of Urban Economics, Elsevier, vol. 63(2), pages 723-742, March.
    4. Maria Molina-Domene, 2018. "Specialization matters in the firm size-wage gap," CEP Discussion Papers dp1545, Centre for Economic Performance, LSE.
    5. Rosenthal, Stuart S. & Strange, William C., 2001. "The Determinants of Agglomeration," Journal of Urban Economics, Elsevier, vol. 50(2), pages 191-229, September.
    6. Molina-Domene, Maria, 2018. "Specialization matters in the firm size-wage gap," LSE Research Online Documents on Economics 88696, London School of Economics and Political Science, LSE Library.
    7. J. Vernon Henderson, 2003. "Urbanization and Economic Development," Annals of Economics and Finance, Society for AEF, vol. 4(2), pages 275-341, November.
    8. John M. Quigley, 1998. "Urban Diversity and Economic Growth," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 127-138, Spring.
    9. Steven N. Durlauf & Ananth Seshadri, 2003. "Is assortative matching efficient?," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 21(2), pages 475-493, March.
    10. Berliant, Marcus & Reed III, Robert R. & Wang, Ping, 2006. "Knowledge exchange, matching, and agglomeration," Journal of Urban Economics, Elsevier, vol. 60(1), pages 69-95, July.
    11. Burgess, Simon & Lane, Julia & Stevens, David, 1997. "Jobs, Workers and Changes in Earnings Dispersion," CEPR Discussion Papers 1714, C.E.P.R. Discussion Papers.
    12. Theodore Papageorgiou, 2022. "Occupational Matching and Cities," American Economic Journal: Macroeconomics, American Economic Association, vol. 14(3), pages 82-132, July.
    13. Stuart S. Rosenthal & William C. Strange, 2003. "Geography, Industrial Organization, and Agglomeration," The Review of Economics and Statistics, MIT Press, vol. 85(2), pages 377-393, May.
    14. Dauth, Wolfgang, 2010. "The mysteries of the trade: employment effects of urban interindustry spillovers," IAB-Discussion Paper 201015, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    15. William C. Strange, 2009. "Viewpoint: Agglomeration research in the age of disaggregation," Canadian Journal of Economics, Canadian Economics Association, vol. 42(1), pages 1-27, February.
    16. Frank Neffke, 2017. "Coworker Complementarity," SPRU Working Paper Series 2017-05, SPRU - Science Policy Research Unit, University of Sussex Business School.
    17. Gan, Li & Zhang, Qinghua, 2006. "The thick market effect on local unemployment rate fluctuations," Journal of Econometrics, Elsevier, vol. 133(1), pages 127-152, July.
    18. Henderson, J. Vernon, 2003. "Marshall's scale economies," Journal of Urban Economics, Elsevier, vol. 53(1), pages 1-28, January.
    19. Yankow, Jeffrey J., 2006. "Why do cities pay more? An empirical examination of some competing theories of the urban wage premium," Journal of Urban Economics, Elsevier, vol. 60(2), pages 139-161, September.
    20. Volker Grossmann, 2003. "Managerial Job Assignment and Imperfect Competition in Asymmetric Equilibrium," CESifo Working Paper Series 914, CESifo.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:jlabec:v:19:y:2001:i:4:p:879-99. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/JOLE .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.