Communication Externalities in Cities
Paper No' CEPDP0592:
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Keywords: human capital; cities, communication externalities
JEL Classification: J31; R19; R29
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This Paper is published under the following series:
CEP Discussion Papers
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To identify communication externalities in French cities, we exploit a unique survey recording workplace
communication of individual workers. Our hypothesis is that in larger and/or more educated cities, workers
should communicate more. In turn, more communication should have a positive effect on individual wages. By
estimating both an earnings and a communication equation, we find evidence of communication externalities.
Being in a larger and more educated city makes workers communicate more and in turn this has a positive
effects on wages. However, only a small fraction of the overall effects of a more educated and larger city on
wages percolates through this channel.