Description

Using data from the 2004, 2006 and 2009, Social Protection Survey (Encuesta de Protección Social), in this article we show evidence that suggests that in Chile the rent expenditure to labor income ratio is constant across regions and through time. We use this finding in order to parametrize a canonical theoretical localization model. We contrast the model’s predictions with our data. We find that small wage differences account for a significant share of the differences we observe in housing rents across regions.