The New Economic Geography predicts a positive effect of market access on wages, as represented by the wage equation. Several studies provide empirical evidence in favor of the wage equation. However, a key problem is the endogeneity of market access: it is challenging to identify the causal...

Redding and Sturm (2008) use the German division as a natural experiment to study the importance of market access for regional development. They show empirically that cities close to the East-West German border experienced a significant decline in population growth due to division. I argue that...

In this paper, we use the new economic geography (NEG) framework to estimate the extent to which spatial wage disparities in the South African manufacturing sector are an outcome of economic forces such as market access. To test the relationship, we use the anonymized tax data on employers and...

A basic result of new economic geography (NEG) models is that the proximity to consumer markets impacts wages and employment within regions. The ongoing process of European integration, being targeted on the reduction of barriers to trade and factor mobility, has presumably changed relative...

This paper posits a new approach to the ?wage equation? of the New Economic Geography (NEG). On one side, it is shown that the NEG provides a spatial explanation of marginal costs, instead of wages. On the other side, and focusing on the statistical properties of the data, it is explained why...

This paper assesses impact of accessibility corresponding to three distinct modes of urban transportation. The Alonso hypothesis of residents being fully compensated for rents increasing with proximity to CBD by employment opportunities is tested by application of a hedonic model using micro...

This paper develops a framework for predicting impact of urban railway network extensions on property prices. Impact of market potential and access to employment is assessed within a hedonic model environment employing potentiality variables and highly disaggregated data. Based on empirical...

This paper investigates how internal migration is a affected by Brazil's increased integration into the world economy. We analyze the impact of regional differences in access to foreign demand on sector-specific bilateral migration rates between the Brazilian states for the years 1995 to 2003....

Under apartheid, black South Africans were severely restricted in their choice of location and many were forced to live in homelands. Following the abolition of apartheid they were free to migrate. Given gravity, a town nearer to the homelands can be expected to receive a larger inflow of people...

Regional labor markets are characterized by huge disparities. The literature on the wage curve argues that there exists a negative relationship between unemployment and wages. However, this literature cannot explain how disparities of these variables between regions endogenously arise. In...