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Provincial Wage Gap in Iran: An Application of New Economic Geography
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Saeed Rasekhi *   , Marzieh Dindar Rostami |
| , srasekhi@umz.ac.ir |
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Abstract: (9814 Views) |
| This paper studies the factors influencing the wage gap of the industries with more than 10 employees, among provinces of Iran, using the new economic geography model. For this purpose, having used the panel data method as well as 2175 observations (435 inter-province gaps during 2003-2007), spatial structure of wages in Iran has been studied. The important indication of the study is that the new economic geography provides a good description of the spatial structure of wages in the provinces of Iran. Since the size of market and inverse distance-weighted have positive relationship with wages while prices of non-trade goods have negative effects on the spatial structure of wages, thus, the wage structure is less affected by labor force features or labor productivity than by conditions governing the labor market. The study suggests further attention to the agglomeration and impact of the wages in the economic development programs. It is also necessary to distinguish the provinces with wage disparity as well as the factors affecting disparities, for wise implementation of proper economic policies in order to balance the distribution of income. |
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| Keywords: New Economic Geography, Helpman Model, Wage Gap, Agglomeration, Iran. |
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Full-Text [PDF 398 kb]
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Type of Study: Research |
Subject:
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