Wages, Rents, Unemployment, and the Quality of Life: A consistent theory-based measure

Wrede M (2015)


Publication Language: English

Publication Type: Journal article

Publication year: 2015

Journal

Publisher: Wiley-Blackwell

Book Volume: 55

Pages Range: 609-625

Journal Issue: 4

DOI: 10.1111/jors.12176

Abstract

Combining a spatial equilibrium model with a search-matching unemployment model,
this paper analyzes the willingness to pay for regional amenities and the regional quality of life when wages, rents, and unemployment risk compensate for local amenities and disamenities. The results are compared with those obtained from the Rosen-Roback approach. We demonstrate that the traditional approach gives too much weight to the wage differential if search frictions are significant. Furthermore, the paper confirms that the wage curve is negatively sloped for quasi-linear utility. Specifically, the wage rate increases and the unemployment rate decreases in response to an increase in the amenity level if the amenity is marginally more beneficial to producers than to consumers.

Authors with CRIS profile

How to cite

APA:

Wrede, M. (2015). Wages, Rents, Unemployment, and the Quality of Life: A consistent theory-based measure. Journal of Regional Science, 55(4), 609-625. https://dx.doi.org/10.1111/jors.12176

MLA:

Wrede, Matthias. "Wages, Rents, Unemployment, and the Quality of Life: A consistent theory-based measure." Journal of Regional Science 55.4 (2015): 609-625.

BibTeX: Download