Wrong Origin or Wrong Neighborhood : Explaining Lower Labor Market Performance of French Individuals of African Origin
AbstractIn this study, I estimate models with cluster xed eects, in order to disentangle the ef-fects of neighborhoods of residence from the ones of parents' nationalities on the probabilityfor a French individual to be employed and on his wages. I take advantage of the samplingstructure of the LFS to purge cluster eects, using a conditional logit model for employmentand panel OLS for wages. The employment probability gap and the wage gap between Frenchworkers with French-born parents and French workers with parents of African origin may bedecomposed into three components: one due to a gap in observables, one due to a gap inneighborhood quality, and one unexplained component. It is found that the neighborhoodquality accounts for around one quarter of the employment dierential, while the unexplainedpart covers the rest. Wage dierentials are mainly explained by dierences in average in-dividual charecteristics. When cluster eects are introduced in the model, dierences inneighborhood quality accounts for around one quarter of the wage gap.
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Bibliographic InfoPaper provided by Centre de Recherche en Economie et Statistique in its series Working Papers with number 2009-04.
Date of creation: 2009
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