This paper proposes maximum likelihood estimators for panel seemingly unrelated regressions with both spatial lag and spatial error components. We study the general case where spatial effects are incorporated via spatial errors terms and via a spatial lag dependent variable and where the...

Cities and towns are loci of population and production. In 2010, 80.7 percent of the United States population resided in urban areas, and the U.S. Bureau of Economic Analysis reported that in 2011, 90.1 percent of GDP was produced in metropolitan statistical areas (MSAs), emphasizing that urban...

This paper explores the pricing of heterogeneous goods in the presence of market segmentation. We use housing as an example. We extend the theoretical hedonic model of Rosen (1974) and show that, in the presence of market segmentation, the hedonic price line is no longer continuous or unique....

We argue that in labor markets with central wage bargaining wage flexibility varies systematically across the wage distribution: local wage flexibility is more relevant for the upper part of the wage distribution, and flexibility of wages negotiated under central wage bargaining affects the...

Collective bargaining in Germany takes place either at the industry level or at the firm level; collective bargaining coverage is much higher than union density; and not all employees in a covered firm are necessarily covered. This institutional setup suggests to explicitly distinguish union...

This paper investigates the increase in wage inequality, the decline in collective bargaining, and the development of the gender wage gap in West Germany between 2001 and 2006. Based on detailed linked employer-employee data, we show that wage inequality is rising strongly – driven not only by...

This paper compares trends in wage inequality in the U.S. and Germany using an approach developed by MaCurdy and Mroz (1995) to separate age, time, and cohort effects. Between 1979 and 2004, wage inequality increased strongly in both the U.S. and Germany but there were various country specific...

Using linked employer-employee data, this study measures and decomposes the differences in the earnings distribution between male and female employees in Germany. I extend the traditional decomposition to disentangle the effect of human capital characteristics and the effect of firm...