Is it easier to escape from low pay in urban areas? Evidence from the United Kingdom’, Environment and Planning

Using urban and rural data on low pay employment spells from the British Household Panel Survey, we estimate a non-parametric discrete time competing risk model of low pay exits allowing for heterogeneity to four possible destinations, namely, to a ‘high pay ’ job, self-employment, unemployment and out of the labour force. The results suggest that there are differences in the underlying processes leading to exits from low pay across urban and rural labour markets. The overall impact of these urban-rural differences is to significantly decrease the expected time spent in low pay for those in urban labour markets