Working Paper No. 1352

Mysteries of the Trade? Skill-Specific Local Agglomeration Economies

Published: August 31, 2020Pages: 26Keywords: Agglomeration economies; Wages; Spillovers; Attenuation; Clusters; Economic proximity; RelatednessJEL-codes: R10; R12; J24

Mysteries of the Trade? Skill-Specific Local Agglomeration Economies Martin Andersson and Johan P Larsson


Using longitudinal Swedish data, we document robust evidence of highly local spillovers between individuals in similar occupations. The results are consistent with the existence of knowledge spillovers between workers performing similar work tasks in the same city-district. We further demonstrate less distance-sensitive benefits of working in diverse districts and regions, characterized by high density of employees in other occupations. The diversity benefits exist only in metropolitan areas and pertain to workers performing advanced services or non-routine work tasks.


Reference:

Andersson, Martin and Johan P Larsson (2020), "Mysteries of the Trade? Skill-Specific Local Agglomeration Economies". IFN Working Paper No. 1352. Stockholm: Research Institute of Industrial Economics (IFN).

Martin Andersson

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