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"Human capital-based theories of cities suggest that large, economically diverse urban agglomerations increase worker productivity by increasing the rate at which individuals acquire skills. One largely unexplored implication of this theory is that workers in big cities should see faster growth...
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working schedules. This simple model can generate unemployment, even if wages adjust instantaneously, firms are perfectly … working for the same hours as high-skilled workers at competitive wages based on productivity. Thus our model offers an … alternative explanation for why unskilled workers are a primary source of structural unemployment"--Federal Reserve Bank of St …
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