Journal article


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


Publication Details
Author(s): Wrede M
Publisher: Wiley-Blackwell
Publication year: 2015
Volume: 55
Journal issue: 4
Pages range: 609-625
ISSN: 0022-4146
Language: English

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.



Focus Area of Individual Faculties


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.

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