Wednesday, August 03, 2022

Trivial economics: Occupational Matching and Cities

When economists restating the obvious! Does it take an economist to find this out? Besides the dismal science we also have the trivial science! 

Why something so trivial like this is published in the American Economic Journal: Macroeconomics? This is like an undergraduate paper judging from the abstract.

From the abstract:
"In this paper, I document that workers in larger cities have significantly more occupational options than workers in smaller ones. They are able to form better occupational matches and earn higher wages. I also note differences in occupation reallocation patterns across cities. I develop a dynamic model of occupation choice that microfounds agglomeration economies and captures the empirical patterns. The calibration of the model suggests that better occupational match quality accounts for approximately 35 percent of the observed wage premium and one-third of the greater inequality in larger cities."

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