This paper provides supportive evidence to the notion that the division of labour is limited by the extent of the (local) market. We first propose a theoretical model. Its main prediction is that scarce specialists occupations are over-represented in large cities. Using census data for French cities, we find strong empirical support for this prediction.Haven't read it, but it is on the "when I have the time" pile of papers.
Thursday, September 02, 2010
An Empirical Test of the Division of Labour
Forthcoming in JUE: