Relative wage variation and industry location

Bernard, Andrew B., Redding, Stephen, Schott, Peter K. and Simpson, Helen (2004) Relative wage variation and industry location. 614. Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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Abstract

Relative wages vary considerably across regions of the United Kingdom, with skill-abundant regions exhibiting lower skill premia than skill-scarce regions. This paper shows that the location of economic activity is correlated with the variation in relative wages. U.K. regions with low skill premia produce different sets of manufacturing industries than regions with high skill premia. Relative wages are also linked to subsequent economic development: over time, increases in the employment share of skill- intensive industries are greater in regions with lower initial skill premia. Both results suggest firms adjust production across and within regions in response to relative wage differences.

Item Type:	Monograph (Discussion Paper)
Official URL:	http://cep.lse.ac.uk/
Additional Information:	© 2004 Bernard, A. and Redding, S. and Schott, P. and Simpson, H.
Uncontrolled Keywords:	Deindustrialization, Relative Factor Prices, Diversification Cones
Library of Congress subject classification:	H Social Sciences > HB Economic Theory H Social Sciences > HD Industries. Land use. Labor
Journal of Economic Literature Classification System:	F - International Economics > F1 - Trade > F14 - Country and Industry Studies of Trade F - International Economics > F1 - Trade > F11 - Neoclassical Models of Trade C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods: General > C14 - Semiparametric and Nonparametric Methods
Sets:	Collections > Economists Online Research centres and groups > Centre for Economic Performance (CEP) Departments > Economics
Rights:	http://www.lse.ac.uk/library/collections/folder/LSERO.aspx
Identification Number:	614
Date Deposited:	05 Mar 2008 10:11
URL:	http://eprints.lse.ac.uk/3701/

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