Older, industrial cities have suffered with the shift from manufacturing to services, butthe increased importance of innovation as an economic driver may help industrial cities,which are often rich in the institutions that generate innovation. This paper studies howinnovation is related to wages for different types of workers (e.g. more-educated versusless, and younger versus older) and to real estate prices for cities. We also studyindustrial and occupational employment shares. Our estimates indicate that innovationand aggregate education are associated with greater productivity in cities. They indicatethat innovation and aggregate education impact wages less in industrial cities, but thatthey impact real estate prices more. We also find greater effects of innovation andaggregate education for more-educated and prime-aged workers. We pay particularattention to controlling for causality and adjustments of factor inputs. |
