Agglomeration mobility: effects of localisation, urbanisation, and scale on job changes

Following increased attention being paid to the importance of labour-market processes in relation to knowledge diffusion and learning, this study addresses the influence of agglomeration economies (localisation, urbanisation, and scale) on the propensity to change jobs between and within local labour markets. From the use of longitudinal individual data (1990–2002), controlling for factors such as age, sex, income, and social relations, the results show that the composition of regional economies influences labour-market dynamism. We identify two cases of intraregional agglomeration mobility, that is, positive effects on job mobility, due to the concentration of similar activities (localisation economies) and the size of the labour market (urbanisation economies). The results also show that localisation economies compensate for regional structural disadvantages connected to small population numbers, as localisation effects in small regions have a significantly positive effect on intraregional job-mobility rates, even compared with localisation effects in large and diversified metropolitan areas. The results indicate that the concentration of similar activities may be useful for small regions, if high levels of job mobility are crucial for the transfer of knowledge and the performance of firms.