Location‐specific knowledge in spatial job search and its outcomes: An empirical investigation

Abstract

This paper investigates how working location influences jobseekers' subsequent spatial job search. Further, it is assessed to what extent mobility between working regions is associated with wage growth. The results show that the working region functions as a prominent geographical anchor around which the new job search is focused. The jobseekers that do find a job far away from their old working region receive a small wage premium, but this premium disappears if selectivity is taken into account. It is concluded that employees demonstrate substantial stickiness to their working locations, and that this is motivated by asymmetry in search costs. No evidence was found that mobility between working regions in itself affects wages.