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This paper examines empirically the economic relationship between local labour market size and firm returns to training. Anchoring in the literature of micro‐foundation of agglomeration economies, we suspect that this relation is driven by two mechanisms: (i) labour pooling which should positively influence the returns to training through matching and learning effects and (ii) the risk of labour poaching, which tends to reduce the returns to training in larger labour markets. Our estimates, based on a large sample of French industrial firms, reveal that returns to training are increasing with the labour market size, suggesting that labour pooling dominates labour poaching effects. On average, returns to training lie between 6.7 and 7.7%, more in line with the microeconomic literature on education than previous studies focusing on training. [ABSTRACT FROM AUTHOR]

This paper analyses the influence of agglomeration and spatial sorting on wages in Brazilian cities. The empirical strategy is based on a two‐step estimation. The first step estimates a wage equation with the observed characteristics of workers and firms and location effects. The second step decomposes the location effects into employment density and fixed effects of firm and worker. We estimate an urban wage premium for a developing country with the simultaneous inclusion of worker and firm fixed effects, instrumental variables, and nighttime lights. We find agglomeration effects of 4.3–5.7%, which are larger than those obtained for developed countries. [ABSTRACT FROM AUTHOR]