Uliana Koriugina (p)

Daniel Felsenstein

A large body of work in urban economics is dedicated to the study of urban wage premium – a variation of wages in relation to the labor market size. While many scholars have contributed to the study of the premium and its sources, only a few have turned their attention to that of post-socialist regions. Estimation of the premium in the post-socialist cities appears to be vital as it helps to get insights about urbanization specifics in the not so long-ago established market economy. This study aims to take a first attempt of estimation of urban wage premium for Russian cities with consideration of individual worker and job characteristics using RLMS HSE (2014-2019) data. Average estimates of urban wage premium were obtained from regression analysis, and findings show that there is a large Moscow premium, which far exceeds that of other cities with population over 1 million people. Estimation of the Moscow premium is about 52% (in comparison to non-urban areas), that might explain long-lasting high growth rates of Moscow economy and population. Whereas premium in cities over 1 million people is at the level of 22%, which allows us to support the monocentric development hypothesis of Russian subregions. The presence of the premium allows us to make conclusions about transformation in the market economy of Russian urban labor markets as post-socialist ones.

Anna Kremer (p)

Daniel Felsenstein

Meeting others with different backgrounds brings up new ideas. In this paper I show that this is relevant not only with respect to heterogeneous industries or nationalities but that regional differences matter too. Regions in a country vary in their traditions and culture. Cultural homogeneity within regions is mixed up by internal migration, that, like international migration, increases diversity of a place. In a novel approach I look at diversity in German municipality associations measured by different family names and investigate the effect it has on the number of generated patents. I use a unique data set from a phone book in 1996 and casualty lists from WWI. I find a significant positive relationship between diversity and generated patents and establish causality by using an instrumental variables estimation with historic postal routes. I show that diversity and openness of a place affect its economic performance positively in terms of innovation when referring to intra-country differences at the local level.