Do workers benefit from industrial agglomeration?

This paper provides an empirical investigation of the advantages accruing to workers in industrial clusters. Using a unique data set based on the Cluster Mapping Project of the Italian National Statistical Institute, we examine whether industry agglomeration leads to wage and labor mobility differentials. We estimate complete Mincerian wage equations, investigating whether returns to seniority and education are a possible source of differentiation. We find that working in an industrial cluster reduces the returns to education, does not affect the returns to seniority, and does not provide average wage premia. On the other hand, industrial agglomeration positively affects the likelihood of being employed, of starting a business, and of making a transition from payroll employment to entrepreneurship; it also increases blue-collar worker mobility across jobs.