This paper presents a general-equilibrium model of endogenous skilled-biased technological change and matching unemployment in a disaggregated economy. We simultaneously endogenise both the direction and pace of technological change as well as the unemployment rates. We show that an increase in...

Human capital is a driving factor of innovation and economic growth. Economic prospects of cities depend on high qualified workers' knowledge and therefore, attracting highly qualified workers plays a fundamental role for cities' prospects. This study contributes to the question which factors...