How Do Local Labor Markets Look From Above? An Automated Satellite-Imagery Approach
Traditionally the geographical boundaries of local labor markets are delineated based on commuting flow data. However, commuting data are expensive to collect, are sporadically collected in developed countries and rarely available in less developed countries. Yet, recent advances in computing capacity and increased availability of satellite imagery offers a unique opportunity to generate local labor market areas in poor environment contexts in a cheap, frequent and automated way. By relying on the well documented mapping between land-use and labor commuting, this paper shows that land-use cover captured with satellite images provides sufficient information to delineate the spatial boundaries of local labor market areas, providing an automated, replicable, and efficient methodology of identification. The performance and practicality of our methodology is compared to other standard definitions and methods in the literature, such as commuting zones. Our approach replicates the performance of commuting-based methods to delineate local labor markets with a better identification of the heterogeneity among these spatial units
Recommended citation: Rowe, F., Soto-Diaz, G. and J. Soto-Diaz (2022). “How Do Local Labor Markets Look From Above? An Automated Satellite-Imagery Approach.”