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Journal of Economic Geography 9 (2009) pp.

3353 Advance Access Published on 2 August 2008

doi:10.1093/jeg/lbn025

Localized mobility clusters: impacts of labour market externalities on firm performance


Rikard Eriksson* and Urban Lindgren**

Abstract
This article analyses the impact of labour market-induced externalities on firm performance by using a unique database that connects attributes of individuals to workplaces for the entire Swedish economy. Based on the analysis of 256,985 workplaces, our results show that firms belonging to networks of local job mobility (i.e. localized mobility clusters) significantly outperform other similar firms within the local labour market. The results also indicate that concentrations of similar and related firms do not explain any considerable part of the variations in firm competitiveness. Labour market externalities derived via local job mobility produce significantly more powerful effects for the involved firms as compared to the degree of co-location, diversity and scale. Keywords: labour mobility, agglomeration economies, firm performance, labour market networks JEL classifications: L25, R12, R23, O18 Date submitted: 18 June 2007 Date accepted: 13 June 2008

1. Introduction
The seminal works by Marshall (1890) and Weber (1929) on agglomeration economies and more recent contributions by Porter (1990, 1998) on clusters have provided a basis for scholars who search for explanations to the competitiveness of firms, regions and nations.1 According to Marshall, it is possible to derive a trinity of externalities causing competitiveness (i.e. inter-firm linkages inducing advantages to firms); inputoutput transactions, technological externalities and labour market pooling which are all assumed to increase the performance of the involved firms. Despite a widespread consensus on the benefits of agglomerations, there is a great deal of ambiguity surrounding both the nature and the spatial scale of these externalities. It is argued that only a minority of all externalities is actually localized (Scott, 1982; Glasmeier, 1988) and Phelps (1992; 2004) even argues that labour market pooling is the only part of Marshalls trinity that still produces significant localized externalities. This notion is confirmed by Power and Lundmark (2004) as they conclude: analyzing the intensity of labour mobility and linkages between activities is one of the more reliable ways

University, Department of Social and Economic Geography, SE-901 87 Umea , Sweden. *Umea email 5rikard.eriksson@geography.umu.se4 University, Department of Social and Economic Geography, SE-901 87 Umea , Sweden. **Umea email 5urban.lindgren@geography.umu.se4 1 This article mainly focuses on agglomerations and not on clusters as defined by Porter (1990; 1998) and his followers. For simplicity, clusters are here treated as a broader phenomenon of agglomerations, since both notions reflect the advantages of co-location and inter-firm linkages.

The Author (2008). Published by Oxford University Press. All rights reserved. For Permissions, please email: journals.permissions@oxfordjournals.org

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of measuring, defining and delimiting both the existence of a cluster and the degree to which the supposed cluster is functioning as an industrial cluster (p. 1041). Apart from some promising findings in more case-oriented economic geographical studies (see some examples below), no attempts have been made to systematically define industrial systems based on labour market flows or to determine how labour market-induced externalities influence the performance of firms throughout an entire national economy. Therefore, the aim of this article is to present a systematic method for defining localized economic systems based on labour market mobility, and to empirically evaluate how these externalities affect firm performance. The rationale for departing from job mobility when addressing externalities of interlinked firms and industries is twofold. First and foremost, the literature identifies a need for more systematic definitions of inter-linked industrial systems. This implies definitions unrelated to the focus on externalities induced by technological know-how in favour of more relational views since the interaction with other economic agents is becoming increasingly important (Glu ckler, 2007). Previous studies on clustered activities have tended to be either top-down, trying to map national clusters based on industry classifications, or bottom-up, identifying clusters in pre-specified local areas (Martin and Sunley, 2003). Since economic clusters are understood to cut across standard industrial classifications, and flows of ideas across industries tend to speed up growth (Glaeser et al., 1992), neither of these approaches has been particularly successful in providing empirical evidence of the advantages of spatial clusters of related activities (Feldmann, 2000; Malmberg et al., 2000). Wolfe and Gertler (2004) argue that, for instance, using location quotients to define economic clusters only to a limited extent reflects the role played by non-market processes. Hence, less tangible social and cultural benefits of being co-locatedoften referred to as untraded interdependencies including labour market dynamism, can add knowledge to the emergence and significance of economic clusters (Storper, 1997). The second reason for departing from job mobility is that the production and circulation of knowledge are becoming key issues for the competitiveness of firms and regions in an increasingly knowledge-based economy (Kogut and Zander, 1992; Maskell et al., 1998; Asheim, 2000). Malmberg and Power (2005) contend that physical mobility of labour within local labour markets is a particularly promising line of enquiry for the analysis of inter-firm linkages as compared to intangible relations like collaboration or rivalry. This is because knowledge, or human capital, ultimately rests within individuals. Knowledge is spatially sticky and best transferred via direct human interaction (Gertler, 2003), which makes physical mobility of labour between workplaces crucial for inter-firm knowledge transfer and for the competitiveness of localized economic systems (Lawson, 1999; Pinch and Henry, 1999; Power and Lundmark, 2004; Hudson, 2005). Another important characteristic of labour market processes is that physical mobility of labour in itself acts like a cohesive process, which builds inter-firm linkages into local communities of practice that, in turn, reduce social distances and stimulate the creation of competitive localized industrial systems (Grabher, 2002; Breschi and Lissoni, 2003; Benner, 2003). Due to the mainly localized nature of labour market processes and the relative immobility of labour (Storper and Walker, 1989), personal contacts including job mobility are occasionally considered as the major regulating institution of localized agglomerations (Duranton, 1999). Based on these theoretical considerations, it is argued that labour market-related externalities play a key role for the formation of localized agglomerations and,

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as a consequence, they also contribute to the competitiveness of co-located inter-linked economic activities. In order to empirically analyse whether inter-firm linkages via labour mobility induce externalities for the firms involved, a unique longitudinal dataset containing geographical and socioeconomic information about every workplace and every worker in Sweden is used to connect workplaces into regional networks of what is here defined as localized mobility clusters (i.e. a group of workplaces interlinked by localized networks of job mobility).2 The generated mobility clusters are then tested in statistical models estimating labour productivity at the workplace level. This is not an entirely unproblematic measure of performance since firms use various amounts of labour and capital in their operations. In the empirical analyses, however, the impact of such variations in productivity is reduced by using indicators reflecting the relative importance of different production factors. In the next section, a discussion of some theoretical arguments for using labour mobility in connection with agglomeration economies is presented. Section 3 deals with the definition of mobility clusters and Section 4 presents the statistical model. In the last two sections, the results are presented followed by some concluding remarks and suggestions for further research.

2. Job mobility and agglomeration


Agglomeration economies are at the heart of much work in economic geography and the term is often referred to as the economic benefits of co-location. Despite this seemingly straightforward definition, it has been argued that the concept of agglomeration economies is surrounded by a plethora of definitions and meanings (see Martin and Sunley, 2003; Phelps, 2004 for critical overviews). Although agglomeration economies are split up into the widely used conceptual trio (Ohlin, 1933; Hoover, 1937; Glaeser et al., 1992)economies of scale, localization economies (MAR-externalities) and urbanization economies (Jacobs externalities)they do not cover all aspects of the concept. In particular, there may be other agglomeration economies which are external as well as internal to the firm (Parr, 2002a, 2002b). By elaborating the conventional classification, several other situations, for example, related to the production process of firms can be identified as generating external economies, which to a varying extent are dependent on geographical proximity. One of the agglomeration economies external to the firm is localization economies associated with Marshalls (1890) industrial districts. According to this line of thought, related firms in the same industry tend to cluster because of the externalities provided by co-location. In these places, there are relatively more employees with specific occupational skills, relatively lower costs for input and output transactions, and a relatively higher availability of information about products and innovations. These characteristics make such places gradually more attractive for new firms as well as for existing firms which consider relocation.
2 Traditionally, the cluster concept has been associated with bundles of related economic activities encompassing firms, in particular industries and places. However, recent case studies show that localized clusters tend to be populated by firms from many different sectors (e.g. Waxell, 2005). By drawing on a specific type of relatedness job mobilitysome aspects of elusive firm relations can be brought into the open not only for case studies but also for large-scale analyses covering the entire economy. Thus, the concept of localized mobility cluster is suggested to combine the original cluster premise of related firms around a core-product with a new interpretation of how relatedness should be understood.

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Despite the fact that both Marshall (1890) and Weber (1929) recognized the role played by the labour force in agglomeration, neither these early contributions nor more recent refined versions (Parr, 2002a) elaborate on the importance of labour mobility for the generation of external economies. Certainly, Marshall acknowledged the significance of labour as a production factor by establishing the advantages of having access to a pool of skilled labour. However, this factor primarily reflects the benefits of a constant market for skill, which emphasizes labour as a specialized commodity that can easily be hired and fired. The labour pool externality is therefore to a larger extent related to the benefits of being able to effortlessly employ needed staff, rather than to the dynamic effects of labour market mobility. This is also reflected in the numerous definitions of agglomerations based on location quotients of industries and employment across regions; studies applying this procedure mostly find only moderate evidence of localized labour market externalities (Malmberg et al., 2000; Wictorin, 2007). Nevertheless, in the aftermaths of the Fordist production regime, new contributions that consider more dynamic aspects of localized externalities and spillovers have emerged. According to Wolfe and Gertler (2004), there are two opposing perspectives on agglomeration and clusters within economic geography. Whereas one approach points out the significance of monetary benefits gained from agglomeration (i.e. reduced costs or increased revenues), the other approach emphasises the importance of social and cultural processes like knowledge creation and learning in sustaining clusters. The latter view is based on the assumption that knowledge is person-embedded, spatially sticky and best transferred via human interaction and sociability. In particular, localized technological externalities associated with Marshallian notions like in the air or industrial atmosphere have in recent years been refined by scholars who contend that externalities go beyond inputoutput transactions (Storper and Venables, 2004). Informal norms, rules and habits guiding firms in their strategic and operational decisions are regarded as important intangible localized assets which generate untraded interdependencies that create and maintain the relative competitiveness of agglomerations (Storper, 1997). Whereas traded interdependencies concern cost reductions (or revenue increase) related to formal transactions between co-located firms, untraded interdependencies are dynamic regional attributes which are less tradable but still economic by nature. As compared to other rather fuzzy aspects related to untraded interdependencies, labour market dynamism is the most tradable part of this concept. It seems to be difficult to systematically define local buzz and its characteristics or quantify the degree of inter-firm linkages via rivalry or informal collaboration. Malmberg and Power (2005) demonstrate that analyses only moderately succeed in providing evidence of the impact of informal collaboration and rivalry. Instead, they argue that localized business systems should be conceived as arenas of well-functioning labour markets where the job mobility of specialized and skilled people plays an important role for the success of associated firms. This view is most likely propelled by the increased attention paid to human capital for economic growth (Becker, 1962; Glaeser, 2000). In most sectors, competent workers have become a key asset for continued innovation and development (Hudson, 2005). A growing knowledge-intensive production brings about a situation where departing workers cannot leave everything behind, because they carry vital information and experiences to their next workplace. Experiences and routines accumulated by individuals are seldom codified in terms of texts or documents, but gained knowledge lingers within individuals and epistemic communities to which they

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are associated. Tacit knowledge follows people and their mobility patterns, which is why this type of knowledge is considered to be spatially sticky and locally embedded (Gertler, 2003). Based on this mechanism, extensive job mobility of skilled labour is considered to facilitate the dissemination of embodied tacit knowledge (Cooper, 2001; Power and Lundmark, 2004). The impact of this process does not necessarily involve a relative gain for the receiving firm as compared to the loss for the dispatching firm (Granovetter, 1973). Bienkowska (2007) argues that former employees may be regarded as ambassadors for the previous firm due to their role as mediating connections to new customers and arranging recruitment of new staff. Previous analyses based on case studies confirm the role played by labour mobility for the competitiveness of regional industrial systems. Pinch and Henry (1999) claim that job mobility is a key localized externality of agglomerations. They report that the intense flows of skilled personnel within the British motor sport cluster facilitated both knowledge creation and knowledge spillovers between firms. By employing a duopoly game, Combes and Duranton (2006) model labour market pooling and mobility. To some extent, their results contest the role played by social and cultural factors (cf. Saxenian, 1996), but they find that labour flows have a positive impact on productivity and that they are increasingly important for firm co-location. In a Swedish context, Power and Lundmark (2004) study the local job mobility of key-personnel within the Stockholm ICT cluster and they find that internal labour markets of clusters are embedded with dynamism. Their analysis shows that local job mobility within the cluster is significantly higher than in the rest of the urban economy. Inter-firm linkages established via job mobility is not only likely to increase the competitiveness of industrial systems, it might also be a key ingredient for the emergence of localized business systems. This is because mobility between workplaces generates a situation of weak occupational ties (Granovetter, 1973; Agrawal et al., 2006), which creates social cohesion between firms exchanging personnel. These coherent clusters constitute operative networks that enhance propensities for an even larger mobility. Moreover, the size and distribution of firms in different industries enhance the possibilities of both creating and maintaining weak ties, because certain tasks cannot be handled by small units. Hence, there are results indicating that job mobility induces externalities and might even be a prerequisite for the creation of localized inter-linked business systems. Before addressing the empirical role played by labour market externalities, two theoretical questions must be dealt with concerning the conceptual (and indeed empirical) incoherence associated with agglomerations and clusters. The first question refers to in which parts of the spatial economy evidence of labour market externalities can be expected to be found. Despite the recurrent definitions of agglomerations and economic clusters being centred around a core product or a bundle of similar industries (Porter, 1990; Almeida and Kogut, 1999: Malmberg et al., 2000; Power and Lundmark, 2004), localized economic systems are increasingly being understood to cut across industrial classifications, partly because industrial variety and broadened human capital tend to speed up growth (Glaeser et al., 1992). Traditional definitions often adopt a topdown perspectivemapping clusters based on industry classificationsor a bottom-up perspectiveidentifying clusters in pre-specified local areas (Martin and Sunley, 2003). These approaches have not been entirely successful, however, it has even been argued that definitions and evaluations of localized economic systems might be anecdotal and based on success stories found in particular places (Malmberg, 1996).

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Nevertheless, one of the fundamental traits of clusters is their systemic characteristics, where firms are related to each other in different ways. The traditional way of defining these relationships has been by analysing buyer/supplier relations or stressing the relative importance of certain economic sectors in regions. The latter method is usually associated with the weakness of being too much driven by the standard industry-code, which is organized by production output. Several case studies have shown that clusters of related activities often include firms belonging to a large number of different industries (Waxell, 2005). However, due to the complexity of inter-firm linkages, it is very difficult to define localized economic systems in a reliable way. The increased attention paid to the potentials of labour mobility may be helpful in this respect. Yet, this idea brings about another issue regarding on which type of labour the focus should be. In many studies on job mobility in clusters, there has been a considerable interest in key persons (Almeida and Kogut, 1999; Power and Lundmark, 2004). In contrast to this belief, we suggest that the potentials for firm performance of job mobility should be analysed from a much broader point of view. There are reasons to believe that larger groups of skilled individuals found in all parts of the economy, from the service sector to R&D, could potentially take part in a learning process with a positive influence on firm competitiveness (cf. Glaeser et al., 1992; Maskell et al., 1998; Engelsoft et al., 2005). Hence, we argue that the embodied knowledge of all individuals changing jobs within and between industries in various ways contributes to the performance of firms. The second question concerning the conceptual incoherence associated with agglomerations refers to in which spatial scale the labour market externalities occur. There is a plethora of spatial definitions of localized economic systems varying from postal code areas up to the national/international regions, which obviously disrupt any attempt at producing systematic and comparable definitions (Scott, 1982; Martin and Sunley, 2003; Phelps, 2004). Nevertheless, it is evident that externalities related to monetary inputoutput relations are becoming increasingly mobile, whereas technological externalities like sociability and face-to-face contacts together with labour market pooling remain localized (Phelps, 2004). Hence, the relative immobility of the labour force and the localized consequences of this immobility become crucial when defining localized economic systems based on job mobility. Regardless of recent theorizations on the role of hyper-mobile talent (cf. Florida, 2002), labour is widely acknowledged to be the most localized factor of production, and most people remain in their home regions without reflecting on migration options (Storper and Walker, 1989; Malmberg, 2003). The intra-regional dimension of job mobility is related to the fact that accumulated place-specific human capital will be a sunk cost if changing region of work by significantly interrupting relations to friends, colleagues, clients etc. (Fischer et al., 1998). Hence, since job mobility is predominantly a local process within urban areas, we argue that knowledge and learning derived via job mobility can be regarded as a localized economic externality within the spatial range of functional local labour markets. This externality will also affect firms profit and loss accounts since new insights into the performance of production will likely result in reduced costs or increased revenues for the involved firms.

3. Defining localized mobility clusters


The analysis of labour market flows in this article is carried out using data from ASTRID, which is a longitudinal micro database created by matching several

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administrative registers at Statistics Sweden (SCB). At present, the database covers the period 19852003 and includes annual information about all Swedish inhabitants, firms and workplaces. The high resolution of socio-economic data renders it possible to analyse all flows of employees changing workplaces within and between local labour market regions. In spite of the attractive theoretical properties of localized mobility clusters discussed in the previous section, the empirical definition of such clusters is by no means a straightforward task. This is mainly due to the large number of nodes and flows in the labour market networks. At the national level, there are more than 150,000 individuals changing jobs between nearly 50,000 workplaces during the year of study (2001). The numbers vary substantially between the different local labour markets. For example, the Stockholm local labour market region had more than 70,000 job changers (between nearly 5000 workplaces), whereas the corresponding figures for one of the smallest regions in population numbers amounted to 6 job changers between 12 workplaces. However, most of the regions have thousands of job changers and workplaces with a turnover of employees. This implies that the number of nodes in most local labour market networks is large, which makes it virtually impossible to analyse relationships by traditional network graphs available in software packages for social network analysis. As an alternative to using such tools, we developed a computer program that creates localized mobility clusters based on flows of job movers between workplaces. A starting point for the clustering process is to define the population of workers that should be included in the sample. A basic proposition in our work is that the analysis should focus on full-time working individuals who have established themselves on the labour market. In Sweden, only a small minority of the population enters the labour market before the age of 25 (Hedin, 2001), which supports the notion of excluding all workers aged below 25 from the analysis. Youths often attend various educations and in these periods, they work weekend and afternoon hours to an extent equivalent to less than half time. These levels are not only connected to crude time budget constraints, but also to the preconditions for being eligible for student grants. Too high incomes from work will significantly reduce the grant. To take these considerations into account, it was concluded that job changers must (1) earn more than 200,000 SEK annually, (2) be at least 25 years of age and (3) be registered to have changed workplace identity and workplace coordinates (hectare square) during 2001. The income was set to a level reflecting the relation to the labour market. The average monthly income from work was 21,300 SEK which is to be compared to a monthly income of 16,600 SEK (equivalent to an annual income of 200,000 SEK) which represents the lowest wage levels for full-time work. This implies that relatively more part-time workers in low-paid occupations than high-paid occupations are removed from the sample. It could therefore be argued that the wage condition is set too high, but a lower level increases the likelihood of including groups that are not obviously engaged in gainful employment, which is essential for this analysis. The combination of factors in the third condition is justified by the shortcomings of workplace identity over time. The change in workplace identity (which is an attribute of the individual) cannot be fully interpreted as the individual really having changed workplaces. Occasionally, and especially regarding small workplaces with few employees, the workplace identity is altered due to changes in the ownership of the company. To reduce such data errors, we also use the more reliable information of workplace coordinates associated with the

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individual. The reason for this is that job changers mostly go to new jobs located further than a hundred meters from the old one. After defining the labour force, as well as the job changers, it is necessary to set up the spatial scale of labour market externalities. Here, we suggest the use of Statistic Swedens official definition of functional labour markets. These 108 functional regions are defined based on commuting patterns between 290 municipalities.3 Hence, the local labour market regions are spatial units with distinct characteristics reflecting the labour market situation and the composition of local trade and industry in different parts of the country. For each of the 108 local labour market regions, the computer program starts the clustering process by selecting all workplaces with a labour turnover between year 2000 and 2001. The identified workplaces with labour exchange represent the first tier of the network of associated mobility clusters. For each of the chosen workplaces in the first tier, the computer program creates a list of related workplaces in the second tier (i.e. from which workplaces newcomers have left and to which workplaces former employees have gone). Information is provided about the number of employees observed in the specified flows. If any of the workplaces identified in the second tier have labour exchange, the flows to and from the third tier workplaces are recorded by the program. In the next step of defining mobility clusters, the numbers of links and job movers between first-tier workplaces and workplaces found in the second and third tiers are summed up.4 The program calculates pivot tables that present the relation between first-tier workplaces and second-/third-tier workplaces. Based on this calculation, it can be concluded between which parts of the local labour market there is job mobility interaction. In order to make local labour markets of different sizes more comparable and avoid too much influence from workplaces with few links carrying small numbers of job movers, it was decided to merely include workplaces with a relatively large numbers of links. The cut was set so as to minimize the risks of obtaining mobility clusters founded on random patterns in the dataset. After removing the negligible links, the remaining linked workplaces are identified. Workplaces characterized by job mobility interaction are grouped and defined as localized mobility clusters. Running the computer program on data from every local labour market shows that there are various numbers of localized mobility clusters in different parts of the country. There are large variations between the local labour market regions regarding numbers of clusters and the share of the local economy that the workplaces represent. For example, the number of mobility clusters in the regions ranges between none and seventeenon average, there are close to four clusters in each region. In total, nearly 30% of all workplaces are identified as mobility clusters which account for more than 40% of total labour productivity at the national level. Thus, descriptive statistics

3 4

The number of local labour market regions varies over time according to changes in observed commuting patterns. In general, the regionalization is made to minimize inter-regional flows. There is no clear-cut number of tiers to be incorporated in the clustering procedure. Three tiers were chosen in order to restrict the complexity of the procedure. This is a somewhat arbitrary cut because the more tiers are used, the larger are the chances of merging workplaces. However, there is no obvious criterion to use as a benchmark for evaluating the appropriate number of tiers in the analysis. It can be assumed that the marginal addition of linkages between workplaces decreases quite rapidly after the first three tiers, as most connections are detected at this stage of the clustering procedure. This assumption is supported by the outcomes of the first, second and third tiersin general, the number of detected workplaces linked to each other gradually diminishes as we move downwards the tier hierarchy.

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indicate more dynamism in the parts of the local labour markets characterized by intensive labour exchange.

4. Empirical analysis
After mapping out the geography of mobility clusters in each of the 108 Swedish functional local labour markets, we proceed to examine the reliability of the definition. If there is any precision in the mobility cluster definition, we expect workplaces inside mobility clusters to be more competitive than those outside, because of the externalities triggered by the labour market. 4.1. Dependent variable: labour productivity In this article, labour productivity is used as the main indicator of firm performance and it is defined as value added per employee. Even though traditional agglomeration theory pays a great deal of attention to relative differences in factor prices, more recent analyses of competitiveness and performance show more interest in how firms increase the efficiency in production. According to Schumpeter (1939), innovative and competitive firms are able to use their resources more efficiently which makes them more productive than less innovative firms. Hence, the use of productivity as the goal variable enables us to measure both the relative efficiency and the relative innovativeness of firms. However, value added is reported for firms and not for workplaces. Approximately 15% of all firms have more than one workplace. For these cases, value added was distributed to workplaces in proportion to their wage distribution (cf. Wictorin, 2007). The calculated sums of value added were subsequently divided by the number of employees of the workplace. This procedure potentially takes both education and experience into account when measuring labour productivity at the workplace level. This aspect would be neglected if only distributing value added according to the workplaces share of firm employees. In the model, log values are used to reduce the impact of skewed distributions. In order to control for the consistency of the mobility cluster variable, a corresponding model using a different goal variable is used since the estimates on value added may be biased towards large-scale manufacturing workplaces that conceal some of the effects of mobility clusters in service industries, e.g. financial industries. Therefore, labour wage, defined as per capita wages for each workplace, is also used as a proxy for competitiveness. It could be argued that labour wage is a proxy for agglomeration diseconomies as higher wages increase the costs. However, this specification is introduced on the assumption that firms and workplaces paying higher wages are also more productive in general (see Abowd et al., 1999 for empirical support of this notion). Moreover, a regional development perspective is also adopted by modelling per capita wages. Higher wages boost the purchasing power of the households and increase tax revenues to the local public sector. From this point of view, it could be argued that increased wages have a positive impact on the economic performance of the region. By using wages rather than labour productivity, the number of cases estimated increases to 337,462 as compared to the 256,985 cases when estimating labour productivity. Similar to the labour productivity equation, log values are used in this regression. The outcomes from using labour wage as a goal variable are displayed in Table A2 (Appendix).

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4.2. Variables and statistical model Besides the independent dummy variable mobility cluster, described in detail in Section 3, other covariates controlling for variations in productivity and wages are accounted for (Table 1). Six of these variables are of particular interest; three of them are related to labour mobility and the remaining ones are associated with traditional approaches for defining agglomeration economies based on spatial concentrations. Despite the benefits related to job mobility, too much inflow and outflow of labour can be disadvantageous because of sunk costs associated with high levels of labour turnover (Becker, 1962; Almeida and Kogut, 1999). Therefore, we also control for the proportion of workers that have departed from the workplace 3 years back in time (t1, t2 and t3) as compared to the year of observation (t0). The higher is the value, the higher is the share of newcomers as compared to the workforce in year 2001. One interpretation of these three variables is that they indicate the net effect of staff turnover on productivityon the one hand, turnover generates costs in connection with recruitment and job introduction, on the other hand turnover is likely to be associated with learning and knowledge diffusion beneficial to the firm receiving new labour. Since we stress the relevance of labour market externalities in contrast to more traditional definitions of agglomeration economies, similar definitions of the economies of localization, urbanization and scale are used as those in Ellison and Glaeser (1997), Malmberg et al. (2000) and Eriksson et al. (in press). These measures are employed to provide an estimate of the relative effect of different labour market externalities. The industrial definition is based on a two-level aggregation of the official Swedish industrial classification code (SNI92). The number of workplaces in the same 2-digit industry code within a local labour market is used to measure the concentration of related and similar firms, as compared to both the national and the regional economy. Workplaces scoring higher than 1 are defined as localization economies, indicating a regional specialization which is assumed to increase the performance of workplaces. Localization economies     Local workplaces, all industries Local workplaces in industry = Total workplaces in industry Total workplaces, all industries

When using the number of workplaces rather than employment, concentrations due to the organization of the industry are avoided. For example, this might be the case when a large number of employees is working within a small number of large firms across the country (Ellison and Glaeser, 1997). In the regression analysis, log values of the quotient are used in order to reduce the impacts of skewed distributions. When capturing the effects of urbanization economies, the log of the total number of all workplaces in all industries, except industries defined as localization economies, is used to reflect branch diversification within the local labour markets. Finally, the effect of relative scale is calculated using the relative size of workplace employment. Scale economies     Workplace employment Local employment, all industries = Total employment in industry Total employment, all industries

Localized mobility clusters


Table 1. Variable definitions Definition

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Model variable Labour mobility Mobility cluster Turnover (9800) Agglomeration effects Localization eco. Urbanization eco. Scale eco. Industry Know manu Capital manu Labour manu R&D Public Finance Capital service Labour service Other capital Workplace characteristics Small firm Medium firm Large firm Workplace age Workplace age2 Related units Workforce characteristics Low education Medium education High education Age (1824) Age (2539) Age (4065) Female Foreign Per capita benefits

Dummy variable 1 if workplace is defined as belonging to a mobility cluster Share of new employees at workplace as compared to year 2001 (annually 19982000) Localization economy if quota 41 (log) Urbanization economy based on total number of workplaces (log) Scale economy if quota 41 (log) Dummy variable 1 if workplace is defined as knowledge intense manufacturing Dummy variable 1 if workplace is defined as capital intense manufacturing Dummy variable 1 if workplace is defined as labour intense manufacturing Dummy variable 1 if workplace is defined as R&D Dummy variable 1 if workplace is defined as public sector Dummy variable 1 if workplace is defined as financial industry (base) Dummy variable 1 if workplace is defined as capital intense service Dummy variable 1 if workplace is defined as labour intense service Dummy variable 1 if workplace is defined as other capital intense industry Dummy variable 1 if number of 1 and 19 (base) Dummy variable 1 if number of 20 and 199 Dummy variable 1 if number of Age of workplace (012 years) Age of workplace (square) Number of workplaces within the employees at the workplace is between employees at the workplace is between employees at the workplace is !200

same firm

Share of employees at the workplace with an educational level equivalent to high school or lower (base) Share of employees at the workplace with a short or long university degree Share of employees at the workplace with a licentiate degree or a PhD Share of employees at the workplace aged 1824 Share of employees at the workplace aged 2539 Share of employees at the workplace aged 4064, i.e. the official Swedish retirement age (base) Share of female employees at the workplace Share of employees born outside a Nordic country at the workplace Per capita income of social benefits (unemployment, parental, retirement, etc.) at the workplace

Workplaces scoring higher than 1 are large in relation to both national industry employment and total regional employment, which is defined as scale economies. Such a relative domination indicates an internal specialization which presumably has a positive effect on the degree of competitiveness. The quotient is entered in the equation as log

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values. In addition, three dummy variables controlling for absolute employment size are entered so as to control for the effects of employment size. Several other covariates, which are likely to be relevant for the modelling of productivity levels at workplaces, are also controlled for (Haltiwanger et al., 1999; Rigby and Essletzbichler, 2002). In order to control for industry-specific variations in productivity, the official Swedish industrial classification codes are aggregated into nine dummy variables (according to a definition suggested by the Swedish Business Development Agency; Nutek, 2000) representing capital, knowledge or labour intensity as well as either manufacturing or service orientation (see the Appendix for more details). Several other covariates may also affect the performance of workplaces. For instance, the age of the workplace together with the absolute size and the relative scope of economic activities are highlighted in the literature (Malmberg et al., 2000; Rosenkopf and Almeida, 2003). These variables are added to the model. Finally, since hours of work are not available in the used dataset but are likely to be highly correlated with labour productivity as well as wages, a proxy controlling for this aspect is also modelled. By calculating the per capita income from all individuals receiving social benefits, it is possible to control for both part-time work and labour market nonparticipation. The definition of mobility clusters based on local labour market mobility suggests that productivity is correlated with processes on the local labour market. The spatial dependence of productivity and the need to incorporate these relationships in modelling efforts are also highlighted in the literature. For instance, Rigby and Essletzbichler (2002) stress that many studies estimating the productivity of agglomeration ignores spatial correlation, which produces spatially biased results. In order to reduce the impact of spatial autocorrelation, a multilevel random-intercept model that allows parallel region-specific slopes is applied.5 This model takes into account that the productivity of workplaces operating within the same local labour market may be affected by the productivity of other workplaces within the same region. Thus, it is possible to model the spatial dependence among the residuals rather than treating the regional variation as unexplained heterogeneity (see Rabe-Hesketh and Skrondal, 2005 for further discussion). The model in its simple form: yij 1 &1j 2 xij 28 xij "ij 3

where y denotes the linear function of the performance of a given firm (i) in a given region ( j ). The normally distributed random intercept, j, is the difference between the overall mean and j:s mean. X is an explanatory variable and "ij represents the combined measurement error.

5. Empirical results
The main question posed in this article concerns the externalities induced by labour market linkages. Before discussing the outcomes of the empirical estimations, some general characteristics regarding Table 2 should be noted. All variables but one are statistically significant at the 95-percent level, which means that almost all of them have
5 Fixed-effects models have also been estimated. This approach did neither change the coefficients, nor the standard errors. Therefore, only the results of the multilevel models are presented in the next section.

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an impact on productivity. However, with more than a hundred thousand observations in both models, it is possible to obtain significant estimates even with only modest effects. Therefore, an additional effect analysis (ANOVA) is carried out in order to describe the relative explanatory power of every single covariate. The greater the score of partial sums of squares (SS), the higher is the influence on productivity. The estimated models and the effects of labour market externalities appear to be insensitive to changes in the model specification. First, all controllers estimated in the base model (Table 2) show the expected signs and all the coefficients, except the dummy-variable for labour intense service, remain stable when adding variables into Models A-D in Table 2. Second, the estimates of the corresponding wage model (Table A2 in the Appendix) show outcomes similar to the productivity models which altogether strengthen the reliability of the estimated effects of labour market externalities. When describing the results in Table 2, six characteristics should be highlighted in particular. First, the outcomes of Model A confirm what has been stressed in previous studies (Harrison et al., 1996; Malmberg et al., 2000); economies of localization, urbanization and scale all have a positive impact on the performance of firms, but it is mainly economies of scale and urbanization that influence spatial patterns of economic performance. The partial SS reveal that the localization effect on productivity is about 100 times smaller than the effects of scale as well as urbanization. Hence, the estimates of Model A show little evidence of co-location of similar and related activities per se inducing localized externalities and improving the performance of the involved firms. Nor are there any indications of the effectiveness of using standard industrial classifications when identifying competitive localized production systems, due to the moderate effect of these variables. When moving on to Model B, the estimates of labour turnover show that high turnover rates have a short-term negative effect on the competitiveness of firms. This implies that sunk costs related to investments in on-the-job-training should, for instance, not be underestimated (cf. Becker, 1962). Nonetheless, the higher the shares of labour turnover 2 and 3 years back in time, the higher the productivity. Altogether, these results confirm that the short-term effects of job mobility may act as a check on the performance of firms, but high degrees of labour circulation improve firm performance in the long run. Hence, our results confirm the importance of externalities assumed to be induced by labour market processes (Pinch and Henry, 1999; Power and Lundmark, 2004). The localized dimension of labour market externalities is more explicitly displayed in Model C. The effects of a mobility cluster on labour productivity are significantly positive. The mobility cluster definition does not separate inflows from outflows; it is the net flows of both inward and outward linkages that are estimated. As a consequence, the results imply that linkages established by former employees by changing workplaces are beneficial for both receiving and sending workplaces (cf. Granovetter, 1973; Bienkowska, 2007). Hence, localized linkages via inter-firm job mobility may well act as a cohesive process, which increases the social proximity between different firms in a diverse set of industries. Consequently, this process appears to enhance the performance of involved firms. The notions put forward by, for instance, Breschi and Lissoni (2003) and Agrawal et al. (2006) are evident, even if defining mobility clusters as being based on the entire workforce throughout the entire national economy, instead of following the career paths of key individuals within certain industries and regions. The most important findings in this article are related to the estimates in Model D. The variables reflecting the relative spatial distribution of industries and labour market

Table 2.

Multilevel models on labour productivity with recorded coefficients (Coef.) and level of significance (P4t)

46

Base model Coef. Mobility cluster Localization eco. Scale eco. Urbanization eco. Turnover00 Turnover99 Turnover98 Know manu Capital manu Labour manu R&D Public Capital service Labour service Other capital Medium firm Large firm Workplace age Workplace age2 Related units Medium education High education Age (2539) Age (1824) Female Foreign Per capita benefits Intercept SD (intercept) SD (residual) Adj r2 N P4t SS Coef.

Model A P4t SS Coef.

Model B P4t SS Coef. 0.205

Model C P4t 0.000 SS 1866 Coef. 0.203 0.025 0.601 0.042 0.461 0.144 0.474 0.487 1.304 0.265 0.398 0.115 0.369 0.038 0.367 2.259 3.661 0.154 0.005 0.002 0.165 0.155 0.430 0.538 0.157 0.511 0.001 5.342

Model D P4t 0.000 0.087 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.001 0.000 0.000 0.000 0.000 0.000 0.000 0.088 1.252 0.353 256,985 SS 1820 14 130 21 3005 170 2321 2073 1382 813 98 218 2096 21 1578 88,222 14,688 4347 697 3812 504 15 4986 2172 772 2906 3418

Eriksson and Lindgren

0.084 0.578 0.053

0.000 0.000 0.000

1 118 101 0.462 0.147 0.472 0.408 1.235 0.191 0.376 0.160 0.332 0.045 0.463 2.280 3.795 0.154 0.005 0.002 0.179 0.213 0.425 0.533 0.176 0.520 0.001 5.753 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.093 1.255 0.349 256,985 256,985 3008 176 2314 1496 1220 396 86 379 1799 65 3051 90,387 16,622 4357 705 3886 631 33 4900 2129 992 2966 3535

0.406 1.212 0.193 0.384 0.162 0.347 0.039 0.473 2.323 3.830 0.133 0.004 0.002 0.187 0.222 0.484 0.641 0.155 0.500 0.001 5.998

0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000

1477 1173 396 89 393 1960 53 3204 94,574 16,932 4094 672 3963 698 36 6681 3318 771 2747 3386

0.412 1.169 0.182 0.383 0.147 0.355 0.024 0.479 2.319 3.752 0.133 0.004 0.002 0.186 0.221 0.485 0.640 0.156 0.501 0.001 5.595

0.000 0.000 0.000 0.000 0.000 0.000 0.002 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.090 1.264 0.339

1513 1130 417 92 361 1930 35 2863 94,103 15,486 4095 668 3985 644 33 6640 3306 774 2833 3305

0.483 1.316 0.275 0.403 0.122 0.384 0.040 0.377 2.305 3.773 0.133 0.004 0.002 0.174 0.164 0.488 0.647 0.135 0.490 0.001 5.895

0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.084 1.262 0.342

2053 1381 808 99 216 2412 39 1873 92,695 16,376 4104 671 3880 584 18 6781 3366 579 2684 3313

0.093 1.265 0.339 256,985 256,985

The table also shows the partial SS from the effect-analysis to indicate the relative effect of each covariate. All models are estimated in STATA9.

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linkages are estimated in the same model. Since all variables show similar signs as in Models AC, the attention should be directed to the third column where the partial SS are displayed. The externalities induced by labour market linkages are consistent, whereas the effect of localization economies drops and becomes insignificant. The effect of urbanization economies also decreases while the scale effect remains relatively strong. The effect of a mobility cluster is more than twice as high as the total effect of localization, urbanization and scale. Hence, the estimates indicate that it is neither the relative concentration of similar firms (localization), nor the relative regional diversity (urbanization) that influences firm performance. Of greater importance is whether workplaces are linked to each other via localized networks of labour flows. This seems to be the case irrespective of industry affiliation or the composition of job movers. It is the qualitative contents of inter-firm linkages that create relative competitiveness, everything else equal. Furthermore, the results do not only indicate that the co-location of related activities has a very modest impact on firm performance, but it also shows that being located in large diversified regions does not influence firm performance to any great extent either. It is the presence of large firms that continues to have a substantial impact on competitiveness (cf. Malmberg et al., 2000). One aspect influencing the moderate effect of urbanization economies may be that agglomeration factors are correlated with the functioning of labour markets in general. The dynamism of local labour markets is usually related to the urban hierarchy, where densely populated regions show higher levels of job mobility due to a more efficient matching process (Eriksson et al., in press). Hence, the relative advantage enjoyed by firms located in large regions is absorbed by the labour market variables in the productivity model.6 One further observation from Table 2 is related to the overall explanatory power. The use of micro data implies much more heterogeneity in the dataset than what would be the case if employing aggregated dataaggregation reduces variation. Despite the strong heterogeneity in the dataset used, r2 values reach comparatively high levels. What should also be noted is the relative change of r2 between the four models. As compared to r2 0.339 in the base model, the location quotients do not add any considerable explanation to productivity, whereas the labour market-related variables in Models B and C increase r2 the most. This outcome is also consistent in the corresponding wage models (Table A2), although the location quotients have a somewhat greater effect on wage levels than on productivity. The final observation relates to the explained variation between and within regions obtained by modelling local labour markets in a multilevel model. In general, the intercepts vary across different local labour markets by a SD between 0.084 and 0.093, whereas the estimated residual standard deviations of the overall error terms are pending between 1.252 and 1.264. Hence, although productivity models are characterized by spatial autocorrelation, there are greater disparities within than between regions which imply that spatial proximity only explains the variations of firm performance to a limited extent.
6 In the corresponding model on labour wage shown in the Appendix (Table A2) however, the relative effect of urbanisation economies is higher than in the productivity model. This effect can partly be explained by generally higher income levels in large urban areas which increase the effect of the urbanisation variable.

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6. Conclusions
Based on a systematic large-scale method for defining localized inter-firm linkages via labour market flows, this article empirically shows the effects of localized labour market externalities on firm performance throughout the entire Swedish economy. By controlling for various factors at the workplace level, the main results of the analysis indicate that concentrations of similar and related firms do not explain any considerable parts of the variations in firm competitiveness. The estimates clearly show that interfirm linkages derived via local job mobility produce significantly more powerful effects for the involved firms as compared to the degree of co-location, diversity and scale. However, it is the internal agglomeration of firms (absolute and relative size) that influences performance the most. Although they have significant effects, labour market linkages only marginally alter the performance. Following Parrs (2002a, 2002b) elaboration on different specifications of agglomeration, the empirical estimates presented in this article make it possible to identify two types of agglomeration effects on firm performance. First, since traditional economic factorsi.e. absolute and relative scalerelated to the Fordist production regime produce the most significant effects on performance, the internal economies derived from scale and scope are still highly influential. Second, the estimates show that localized externalities derived from the labour market boost the performance of the firms involved. It can be argued that labour market-related externalities contain two of Marshalls trinity of externalities (Phelps, 2004), both of which are explored here. The traded element of labour pooling reflects the composition of skills within the regional economy, whereas the dynamic untraded element of technological externalities results in a cross-fertilization of ideas via the exchange of labour between firms. Thus, this article has explored a bridge between traditional externalities related to the pecuniary benefits derived from a set of collective resources within and between firms (i.e. internalization and labour pooling) and externalities originating from learning processes through flows of embedded knowledge (cf. Wolfe and Gertler, 2004). We find that both approaches should be accounted for in the agglomeration analyses. This article does not explicitly estimate the role of proximity for firm performance but it should be noted that spatial proximity and co-location alone do not tell us much about the competitiveness of firms. By drawing on lines of thought introduced by Perroux (1950) and developed by others (Storper, 1997), it is the untraded linkages between firms that produce significant spillovers rather than spatial proximity or co-location per se. By modelling the spatial dependence of productivity within regions in a multilevel model, it is evident that the variation within groups of geographically proximate firms is greater than that between geographically dispersed groups of firms. Hence, the technological externalities derived from the exchange of employees in the local labour market indicate that social proximity might have a larger influence on performance than pure co-location, since dense untraded linkages are more likely to produce cohesive competitive business systems than traded buyerseller relations (Storper, 1997). The approach presented in this article may contribute to new ways of perceiving localized systems of inter-related firms in future empirical studies, i.e. viewing agglomerations as systems of intertwined firms rather than simply spatial concentrations of similar industries defined on static output criteria. The next step would be to determine the degrees of social and geographical proximity of each plant based on their labour market flows and how these flows influence firm performance.

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Such a procedure would be an improvement as compared to indicating the presence of social proximity by a dummy variable. There are more possible challenges for future studies on this topic. By departing from the proposed general method of defining localized inter-firm linkages, further studies may consider agglomerations or clusters as systems of inter-linked firms in contrast to industrial concentration or specific outputs. It would be interesting to more specifically focus on particular parts of the spatial economy to examine whether labour mobility propels economic performance. Moreover, most economic activities are spatially dispersed and work across functional local labour market boundaries (cf. Scott, 1982), which implies that only the localized dimension of labour market externalities is highlighted in this study at the expense of more geographically distant inflows. In order to reduce the risks of lock-in effects as a result of being too much embedded within local institutional and social relations, there is a need for focussing on external linkages as well as on local linkages (Bathelt et al., 2004). In addition, this study does not differentiate between different types of skill inflows and how well these inflows fit the already existing stock of skills within firms as well as regions (cf. Boschma and Iammarino, 2008). Hence, by accounting for geographical distance and the variety and relatedness of skills, it would be possible to gain further insights into the impacts of cognitive proximity on firm performance. Another path for future studies would be to employ a dynamic modelling approach where longitudinal models are estimated in order to investigate how labour mobility can contribute to the understanding of changes in firm performance.

Acknowledgements
The authors wish to thank Kalle Ma kila and Erik Ba ckstro m who coded the computer program needed for creating the mobility clusters. We are also grateful to three anonymous referees for their most constructive comments on the earlier version of this paper. Financial support was granted by the Swedish Governmental Agency for Innovation Systems (VINNOVA), DYNAMO-program. An early version of this paper was presented at the 2007 Regional Studies Association International Conference: Regions in Focus? in Lisbon, Portugal.

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Appendix
Table A1. Variable Know manu Capital manu Labour manu R&D Public Finance Capital service Labour service Other capital
Adopted from Nutek (2000).

Branch definitions Standard industrial classification code (SNI92) 22, 24, 29, 30, 31, 32, 33, 34, 35 21, 23, 27 15, 16, 17, 18, 19, 20, 21, 25, 26, 28, 36, 37 73, 803 75, 85, 91, 92, 99, 801, 802, 804 65, 66, 67, 72, 74 60, 61, 62, 63, 64, 70, 71 45, 50, 51, 52, 55, 90, 93, 95 1, 2, 5, 10, 11, 12, 13, 14, 40, 41

Table A2.

Multilevel models on labour wage with recorded coefficients (Coef.) and level of significance (P4t) Base model Coeff. P4t SS Coeff. Model A P4t SS Coeff. Model B P4t SS Coeff. 0.197 0.047 0.130 0.035 0.000 0.026 0.000 74 8 1221 0.077 0.064 0.071 0.009 0.185 0.202 0.199 0.202 0.450 0.256 1.542 0.406 0.424 0.057 0.001 0.001 0.250 0.555 0.132 0.102 0.352 0.684 0.001 7.080 0.000 0.000 0.000 0.439 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.073 1.146 0.185 337,462 337,462 106 49 72 0 20 703 33 1532 4892 2617 39,603 4761 368 802 80 1268 2009 320 654 92 5314 5580 21,016 Model C P4t 0.000 SS 2352 Coeff. 0.198 0.009 0.146 0.028 0.077 0.060 0.075 0.081 0.278 0.128 0.233 0.163 0.417 0.184 1.448 0.373 0.345 0.056 0.001 0.001 0.233 0.503 0.135 0.094 0.344 0.674 0.001 6.792 Model D P4t 0.000 0.433 0.012 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.081 1.143 0.191 337,462 SS 2096 18 11 935 110 41 72 57 57 237 47 691 3627 1020 30,626 3946 224 746 55 1040 1456 228 627 88 5032 5948 19,873

Mobility cluster Localization eco Scale eco Urbanization eco Turnover00 Turnover99 Turnover98 Know manu Capital manu Labour manu R&D Public Capital service Labour service Other capital Medium firm Large firm Workplace age Workplace age2 Related units Medium education High education Age (2539) Age (1824) Female Foreign Per capita benefits Intercept SD (intercept) SD (residual) Adj r2 N

0.007 0.179 0.203 0.201 0.199 0.446 0.256 1.546 0.413 0.429 0.049 0.001 0.001 0.252 0.557 0.148 0.070 0.348 0.677 0.001 7.142

0.555 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.073 1.146 0.184

1 18 716 33 1503 4810 2628 39,904 4971 379 701 45 1282 2056 324 866 43 5192 5476 20,987

0.010 0.164 0.210 0.195 0.191 0.442 0.248 1.549 0.412 0.416 0.049 0.001 0.001 0.251 0.556 0.148 0.071 0.348 0.678 0.001 6.884

0.385 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.078 1.146 0.186

1 21 577 33 960 4121 1917 36,511 4875 325 691 37 1200 1690 279 791 54 5174 6067 20,461

0.078 0.277 0.128 0.228 0.160 0.409 0.183 1.458 0.381 0.363 0.048 0.001 0.001 0.236 0.504 0.150 0.063 0.339 0.667 0.001 7.048

0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.071 1.144 0.189

39 51 314 46 985 3992 1308 33,581 4159 271 681 37 1114 1774 262 884 35 4922 5348 20,300

Localized mobility clusters

337,462

337,462

53

The table also shows the partial sums of squares (SS) from the effect analysis to indicate the relative effect of each covariate. All models are estimated in STATA9.

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