Upjohn Institute Working Paper No. 93-23

**Published Version**

Journal of Urban Economics 40 (1996), pp. 150-178. Under title The Distributional Effects of Local Labor Demand and Industrial Mix: Estimates Using Individual Panel Data




The contribution of this paper is to use panel data on individuals (specifically, data from the Panel Survey on Income Dynamics) to examine how local demand conditions affect the economic well-being of disadvantaged groups and the poor. Previous research on local labor demand conditions uses data from a single cross-section of local economies, or a time-series of cross-sections of regions. With such data, estimated effects of local labor demand conditions on average labor market outcomes might be attributable to changes in local population composition, as we would expect local demand conditions to change in- and out-migration patterns. Because panel data follows the same individuals over time, it can address the important issue of whether local labor demand conditions affect specific individuals. This paper's estimates suggest that growth in the metropolitan economy particularly helps disadvantaged individuals. Local growth has stronger relative effects for males who are less educated, younger, or have lower expected earnings or work hours, and for females in poorer families. Local growth also has significant effects helping both males and females to exit from poverty, and helping prevent males and females from entering into poverty.

Issue Date

September 1993


Based upon work supported by the National Science Foundation under Grant No. SES-9109538

Subject Areas

ECONOMIC DEVELOPMENT; Local labor markets; Regional policy and planning; Demand side programs; UNEMPLOYMENT, DISABILITY, and INCOME SUPPORT PROGRAMS; Poverty and income support; Low wage labor markets




Bartik, Timothy J. 1993. "The Effects of Local Labor Demand on Individual Labor Market Outcomes for Different Demographic Groups and the Poor." Upjohn Institute Working Paper No. 93-23. Kalamazoo, MI: W.E. Upjohn Institute for Employment Research.