The distributional effects of local labor demand and industrial mix: Estimates using individual panel data

This paper finds that increases in local labor demand have significant progressive effects on the income distribution, and significantly reduce poverty. The anti-poverty effects of stronger demand have not lessened in recent years. Local labor demand's benefits are particularly great for younger, less-educated men. Labor demand's benefits are similar for blacks and whites, and men and women. The paper also finds that shifts in the local industrial mix toward manufacturing or other high-wage industries do not have progressive effects and do not reduce poverty. (C) 1996 Academic Press, Inc.