IDEAS home Printed from https://ideas.repec.org/p/bdr/borrec/1283.html
   My bibliography  Save this paper

Spatial Spillover Effects in the Labor Market in a Middle-Income Country

Author

Listed:
  • Leonardo Fabio Morales
  • Mauricio Quiñones
  • Eleonora Dávalos
  • Luis Felipe Gaviria

Abstract

Most macroeconomic labor literature on estimating matching functions does not consider spatial spillover effects. However, job search and vacancy-filling processes often involve neighboring locations, as local workers can search for and fill vacancies in nearby labor markets. We estimate a spatial spillover model using annual data for a middle-income country in Latin America. Our findings show that unemployment has a positive spatial spillover effect because an increase in the labor supply raises the probability of filling a vacancy. In contrast, vacancies have a negative spillover effect because local and neighboring vacancies compete to be filled by workers in both markets. RESUMEN: La mayor parte de la literatura laboral sobre la estimación de funciones de emparejamiento no considera los efectos de derrame espacial. Sin embargo, los procesos de búsqueda de empleo y de ocupación de vacantes a menudo involucran ubicaciones vecinas, ya que los trabajadores locales pueden buscar y cubrir vacantes en mercados laborales cercanos. En este trabajo se estima un modelo de derrame espacial utilizando datos anuales para Colombia. Nuestros hallazgos muestran que el desempleo tiene un efecto de derrame espacial positivo porque un aumento en la oferta laboral aumenta la probabilidad de ocupar una vacante. En contraste, las vacantes tienen un efecto de derrame negativo porque las vacantes locales y vecinas compiten por ser ocupadas por trabajadores de ambos mercados.

Suggested Citation

  • Leonardo Fabio Morales & Mauricio Quiñones & Eleonora Dávalos & Luis Felipe Gaviria, 2024. "Spatial Spillover Effects in the Labor Market in a Middle-Income Country," Borradores de Economia 1283, Banco de la Republica de Colombia.
  • Handle: RePEc:bdr:borrec:1283
    DOI: 10.32468/be.1283
    as

    Download full text from publisher

    File URL: https://doi.org/10.32468/be.1283
    Download Restriction: no

    File URL: https://libkey.io/10.32468/be.1283?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
    ---><---

    References listed on IDEAS

    as
    1. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
    2. Juan José Perfetti & Martha Delgado & Javier Blanco & Gabriela Paredes & Arturo García & Julián Naranjo & Javier Pantoja & Lilián González, 2019. "Adecuación de tierras y el desarrollo de la agricultura colombiana : políticas e instituciones," Libros Fedesarrollo 17614, Fedesarrollo.
    3. Knetsch, Jack L, 1989. "The Endowment Effect and Evidence of Nonreversible Indifference Curves," American Economic Review, American Economic Association, vol. 79(5), pages 1277-1284, December.
    4. Dale Whittington, 2010. "What Have We Learned from 20 Years of Stated Preference Research in Less-Developed Countries?," Annual Review of Resource Economics, Annual Reviews, vol. 2(1), pages 209-236, October.
    5. Glenn Harrison, 2006. "Experimental Evidence on Alternative Environmental Valuation Methods," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 34(1), pages 125-162, May.
    6. Peter Rogers, 2002. "Water Governance in Latin America and the Caribbean," IDB Publications (Working Papers) 68878, Inter-American Development Bank.
    7. Bulte, Erwin & Gerking, Shelby & List, John A. & de Zeeuw, Aart, 2005. "The effect of varying the causes of environmental problems on stated WTP values: evidence from a field study," Journal of Environmental Economics and Management, Elsevier, vol. 49(2), pages 330-342, March.
    8. Sheetal Sekhri, 2014. "Wells, Water, and Welfare: The Impact of Access to Groundwater on Rural Poverty and Conflict," American Economic Journal: Applied Economics, American Economic Association, vol. 6(3), pages 76-102, July.
    9. Gáfaro, Margarita & Mantilla, César, 2020. "Land division: A lab-in-the-field bargaining experiment," Journal of Development Economics, Elsevier, vol. 146(C).
    10. Cardenas, Juan-Camilo & Ostrom, Elinor, 2004. "What do people bring into the game? Experiments in the field about cooperation in the commons," Agricultural Systems, Elsevier, vol. 82(3), pages 307-326, December.
    11. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard H, 1990. "Experimental Tests of the Endowment Effect and the Coase Theorem," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1325-1348, December.
    12. Henrich, Joseph & Boyd, Robert & Bowles, Samuel & Camerer, Colin & Fehr, Ernst & Gintis, Herbert (ed.), 2004. "Foundations of Human Sociality: Economic Experiments and Ethnographic Evidence from Fifteen Small-Scale Societies," OUP Catalogue, Oxford University Press, number 9780199262052.
    13. Janssen, Marco A. & Bousquet, François & Cardenas, Juan-Camilo & Castillo, Daniel & Worrapimphong, Kobchai, 2012. "Field experiments on irrigation dilemmas," Agricultural Systems, Elsevier, vol. 109(C), pages 65-75.
    14. Moreno-Sanchez, Rocio & Maldonado, Jorge Higinio & Wunder, Sven & Borda-Almanza, Carlos, 2012. "Heterogeneous users and willingness to pay in an ongoing payment for watershed protection initiative in the Colombian Andes," Ecological Economics, Elsevier, vol. 75(C), pages 126-134.
    15. Gurven, Michael & Zanolini, Arianna & Schniter, Eric, 2008. "Culture sometimes matters: Intra-cultural variation in pro-social behavior among Tsimane Amerindians," Journal of Economic Behavior & Organization, Elsevier, vol. 67(3-4), pages 587-607, September.
    16. Jack, B. Kelsey, 2009. "Upstream-downstream transactions and watershed externalities: Experimental evidence from Kenya," Ecological Economics, Elsevier, vol. 68(6), pages 1813-1824, April.
    17. Laura O. Taylor & Ronald G. Cummings, 1999. "Unbiased Value Estimates for Environmental Goods: A Cheap Talk Design for the Contingent Valuation Method," American Economic Review, American Economic Association, vol. 89(3), pages 649-665, June.
    18. Charles R. Plott & Kathryn Zeiler, 2005. "The Willingness to Pay–Willingness to Accept Gap, the "Endowment Effect," Subject Misconceptions, and Experimental Procedures for Eliciting Valuations," American Economic Review, American Economic Association, vol. 95(3), pages 530-545, June.
    19. Dale Whittington & Stefano Pagiola, 2012. "Using Contingent Valuation in the Design of Payments for Environmental Services Mechanisms: A Review and Assessment," The World Bank Research Observer, World Bank, vol. 27(2), pages 261-287, August.
    20. Meyerhoff, Jurgen & Liebe, Ulf, 2006. "Protest beliefs in contingent valuation: Explaining their motivation," Ecological Economics, Elsevier, vol. 57(4), pages 583-594, June.
    21. Florencia Devoto & Esther Duflo & Pascaline Dupas & William Parienté & Vincent Pons, 2012. "Happiness on Tap: Piped Water Adoption in Urban Morocco," American Economic Journal: Economic Policy, American Economic Association, vol. 4(4), pages 68-99, November.
    22. Andrzej Baranski, 2019. "Endogenous claims and collective production: an experimental study on the timing of profit-sharing negotiations and production," Experimental Economics, Springer;Economic Science Association, vol. 22(4), pages 857-884, December.
    23. Juan José Perfetti & Boris Bravo-Ureta & Arturo García & Javier Pantoja & Martha Delgado & Javier Blanco & Roberto Jara & Consuelo Moraga, 2019. "Adecuación de tierras y el desarrollo de la agricultura colombiana : políticas e instituciones," Informes de Investigación 17269, Fedesarrollo.
    24. Hearne, Robert R. & William Easter, K., 1997. "The economic and financial gains from water markets in Chile," Agricultural Economics, Blackwell, vol. 15(3), pages 187-199, January.
    25. Chakravorty, Ujjayant & Swanson, Timothy M., 2002. "The economics of water: environment and development. Introduction to the special issue," Environment and Development Economics, Cambridge University Press, vol. 7(4), pages 617-624, October.
    26. Carraro, Carlo & Marchiori, Carmen & Sgobbi, Alessandra, 2007. "Negotiating on water: insights from non-cooperative bargaining theory," Environment and Development Economics, Cambridge University Press, vol. 12(2), pages 329-349, April.
    27. repec:idb:brikps:publication-detail,7101.html?id=43566 is not listed on IDEAS
    28. Weldesilassie, Alebel B. & Fror, Oliver & Boelee, Eline & Dabbert, Stephan, 2009. "The Economic Value of Improved Wastewater Irrigation: A Contingent Valuation Study in Addis Ababa, Ethiopia," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 34(3), pages 1-22, December.
    29. Rogers, Peter, 2002. "Water Governance in Latin America and the Caribbean," IDB Publications (Working Papers) 3966, Inter-American Development Bank.
    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. Margarita Gáfaro & César Mantilla, 2024. "Water overvaluation in incentivized bargaining games," Borradores de Economia 1293, Banco de la Republica de Colombia.
    2. Gáfaro, Margarita & Mantilla, Cesar, 2021. "Environmental valuation using bargaining games: an application to water," OSF Preprints tcfyb_v1, Center for Open Science.
    3. John List & Michael Price, 2013. "Using Field Experiments in Environmental and Resource Economics," Artefactual Field Experiments 00447, The Field Experiments Website.
    4. John A. List & Michael K. Price, 2016. "Editor's Choice The Use of Field Experiments in Environmental and Resource Economics," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 10(2), pages 206-225.
    5. John K. Horowitz & Kenneth E. McConnell & James J. Murphy, 2013. "Behavioral foundations of environmental economics and valuation," Chapters, in: John A. List & Michael K. Price (ed.), Handbook on Experimental Economics and the Environment, chapter 4, pages 115-156, Edward Elgar Publishing.
    6. Giles Atkinson & Sian Morse-Jones & Susana Mourato & Allan Provins, 2012. "‘When to Take “No” for an Answer’? Using Entreaties to Reduce Protests in Contingent Valuation Studies," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 51(4), pages 497-523, April.
    7. Domenico Colucci & Chiara Franco & Vincenzo Valori, 2021. "Endowment effects at different time scenarios: the role of ownership and possession," Discussion Papers 2021/279, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    8. Andrea Isoni & Graham Loomes & Robert Sugden, 2011. "The Willingness to Pay—Willingness to Accept Gap, the "Endowment Effect," Subject Misconceptions, and Experimental Procedures for Eliciting Valuations: Comment," American Economic Review, American Economic Association, vol. 101(2), pages 991-1011, April.
    9. Jacquemet, Nicolas & Joule, Robert-Vincent & Luchini, Stéphane & Shogren, Jason F., 2013. "Preference elicitation under oath," Journal of Environmental Economics and Management, Elsevier, vol. 65(1), pages 110-132.
    10. Dirk Engelmann & Guillaume Hollard, 2010. "Reconsidering the Effect of Market Experience on the “Endowment Effect”," Econometrica, Econometric Society, vol. 78(6), pages 2005-2019, November.
    11. William S. Neilson & Michael McKee & Robert P. Berrens, 2013. "Value and outcome uncertainty as explanations for the WTA vs WTP disparity," Chapters, in: John A. List & Michael K. Price (ed.), Handbook on Experimental Economics and the Environment, chapter 6, pages 171-189, Edward Elgar Publishing.
    12. Czap, Natalia V. & Czap, Hans J. & Khachaturyan, Marianna & Lynne, Gary D. & Burbach, Mark, 2012. "Walking in the shoes of others: Experimental testing of dual-interest and empathy in environmental choice," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 41(5), pages 642-653.
    13. Dirk Engelmann & Guillaume Hollard, 2009. "A Shock Therapy Against the “Endowment Effect”," Discussion Papers 09-04, University of Copenhagen. Department of Economics.
    14. Simon Gächter & Eric J. Johnson & Andreas Herrmann, 2022. "Individual-level loss aversion in riskless and risky choices," Theory and Decision, Springer, vol. 92(3), pages 599-624, April.
    15. Mark A. Andor & Manuel Frondel & Colin Vance, 2014. "Diskussionspapier: Zahlungsbereitschaft für grünen Strom – Die Kluft zwischen Wunsch und Wirklichkeit," RWI Materialien, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, pages 27, 05.
    16. Peter D. Lunn, 2013. "Telecommunications Consumers: A Behavioral Economic Analysis," Journal of Consumer Affairs, Wiley Blackwell, vol. 47(1), pages 167-189, April.
    17. Luxford, Anthony, 2022. "Exchange Asymmetry and Charitable Objects," Warwick-Monash Economics Student Papers 34, Warwick Monash Economics Student Papers.
    18. H. Spencer Banzhaf, 2017. "Constructing Markets: Environmental Economics and the Contingent Valuation Controversy," History of Political Economy, Duke University Press, vol. 49(5), pages 213-239, Supplemen.
    19. repec:zbw:rwimat:079 is not listed on IDEAS
    20. Kitessa, R.J., 2018. "On the design and implementation of environmental conservation mechanisms : Evidence from field experiments," Other publications TiSEM cda8497d-6dcf-4092-b815-1, Tilburg University, School of Economics and Management.
    21. Mark A. Andor & Manuel Frondel & Colin Vance, 2017. "Mitigating Hypothetical Bias: Evidence on the Effects of Correctives from a Large Field Study," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 68(3), pages 777-796, November.

    More about this item

    Keywords

    Matching Function; Spatial Spillovers; Spatial Econometrics; Función de Emparejamiento; Efectos Espaciales; Econometría Espacia;
    All these keywords.

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:bdr:borrec:1283. 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: Clorith Angélica Bahos Olivera (email available below). General contact details of provider: https://edirc.repec.org/data/brcgvco.html .

    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.