Advanced Search
MyIDEAS: Login to save this paper or follow this series

How Urbanization Affect Employment and Social Interactions

Contents:

Author Info

  • Yasuhiro Sato

    ()
    (Graduate School of Economics, Osaka University)

  • Yves Zenou

    ()
    (Research Institute of Industrial Economics (IFN), Stockholm University)

Abstract

We develop a model where unemployed workers in the city can find a job either directly or through weak or strong ties. We show that, in denser areas, individuals choose to interact with more people and meet more random encounters (weak ties) than in sparsely populated areas. We also demonstrate that, for a low urbanization level, there is a unique steady-state equilibrium where workers do not interact with weak ties, while, for a high level of urbanization, there is a unique steady-state equilibrium with full social interactions. We show that these equilibria are usually not socially efficient when the urban population has an intermediate size because there are too few social interactions compared to the social optimum. Finally, even when social interactions are optimal, we show that there is over-urbanization in equilibrium.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www2.econ.osaka-u.ac.jp/library/global/dp/1332.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 13-32.

as in new window
Length: 43 pages
Date of creation: Dec 2013
Date of revision:
Handle: RePEc:osk:wpaper:1332

Contact details of provider:
Email:
Web page: http://www.econ.osaka-u.ac.jp/
More information through EDIRC

Related research

Keywords: Weak ties; strong ties; social interactions; urban economics; labor market;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Edward L. Glaeser, 2010. "Agglomeration Economics," NBER Books, National Bureau of Economic Research, Inc, number glae08-1.
  2. Yannis M. Ioannides & Linda Datcher Loury, 2004. "Job Information Networks, Neighborhood Effects, and Inequality," Journal of Economic Literature, American Economic Association, vol. 42(4), pages 1056-1093, December.
  3. Maloney, William F, 1999. "Does Informality Imply Segmentation in Urban Labor Markets? Evidence from Sectoral Transitions in Mexico," World Bank Economic Review, World Bank Group, World Bank Group, vol. 13(2), pages 275-302, May.
  4. Patrick Bayer & Stephen L. Ross & Giorgio Topa, 2008. "Place of Work and Place of Residence: Informal Hiring Networks and Labor Market Outcomes," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 116(6), pages 1150-1196, December.
  5. Patacchini, Eleonora & Zenou, Yves, 2008. "Ethnic Networks and Employment Outcomes," IZA Discussion Papers 3331, Institute for the Study of Labor (IZA).
  6. Helsley, Robert W. & Zenou, Yves, 2014. "Social networks and interactions in cities," Journal of Economic Theory, Elsevier, Elsevier, vol. 150(C), pages 426-466.
  7. Judith K. Hellerstein & Melissa P. McInerney & David Neumark, 2010. "Neighbors And Co-Workers:The Importance Of Residential Labor Market Networks," Working Papers, Department of Economics, College of William and Mary 101, Department of Economics, College of William and Mary.
  8. Zhang, Junfu, 2004. "Residential segregation in an all-integrationist world," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 54(4), pages 533-550, August.
  9. Zenou, Yves, 2011. "Search, migration, and urban land use: The case of transportation policies," Journal of Development Economics, Elsevier, Elsevier, vol. 96(2), pages 174-187, November.
  10. Sébastian Grauwin & Florence Goffette-Nagot & Pablo Jensen, 2010. "Dynamic models of residential ségrégation: an analytical solution," Post-Print, HAL halshs-00502758, HAL.
  11. Calvó-Armengol, Antoni & Verdier, Thierry & Zenou, Yves, 2006. "Strong and Weak Ties in Employment and Crime," CEPR Discussion Papers, C.E.P.R. Discussion Papers 5448, C.E.P.R. Discussion Papers.
  12. Pierre M. Picard & Pascal Mossay, 2013. "Spatial Segregation and Urban Structure," CREA Discussion Paper Series 13-03, Center for Research in Economic Analysis, University of Luxembourg.
  13. Yannis M. Ioannides & Giorgio Topa, 2010. "Neighborhood Effects: Accomplishments And Looking Beyond Them," Journal of Regional Science, Wiley Blackwell, Wiley Blackwell, vol. 50(1), pages 343-362.
  14. Cattell, Vicky, 2001. "Poor people, poor places, and poor health: the mediating role of social networks and social capital," Social Science & Medicine, Elsevier, Elsevier, vol. 52(10), pages 1501-1516, May.
  15. Pierre M. Picard & Pascal Mossay, 2010. "On spatial equilibria in a social interaction model," Working Papers. Serie AD, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) 2010-14, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  16. Topa, Giorgio, 2001. "Social Interactions, Local Spillovers and Unemployment," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 68(2), pages 261-95, April.
  17. Edward L. Glaeser, 2010. "Introduction to "Agglomeration Economics"," NBER Chapters, in: Agglomeration Economics, pages 1-14 National Bureau of Economic Research, Inc.
  18. Wahba, Jackline & Zenou, Yves, 2003. "Density, Social Networks and Job Search Methods: Theory and Application to Egypt," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3967, C.E.P.R. Discussion Papers.
  19. Yamada, Gustavo, 1996. "Urban Informal Employment and Self-Employment in Developing Countries: Theory and Evidence," Economic Development and Cultural Change, University of Chicago Press, vol. 44(2), pages 289-314, January.
  20. Jan K. Brueckner & Jacques-FranÁois Thisse & Yves Zenou, 2002. "Local Labor Markets, Job Matching, and Urban Location," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(1), pages 155-171, February.
  21. Zenou, Yves, 2013. "Spatial versus social mismatch," Journal of Urban Economics, Elsevier, vol. 74(C), pages 113-132.
  22. Edward E. Glaeser & Bruce Sacerdote & Jose A. Scheinkman, 1995. "Crime and Social Interactions," Harvard Institute of Economic Research Working Papers, Harvard - Institute of Economic Research 1738, Harvard - Institute of Economic Research.
  23. George A. Akerlof, 1997. "Social Distance and Social Decisions," Econometrica, Econometric Society, Econometric Society, vol. 65(5), pages 1005-1028, September.
  24. Matt Jackson, 2003. "The Effects of Social Networks on Employment and Inequality," Theory workshop papers, UCLA Department of Economics 658612000000000032, UCLA Department of Economics.
  25. Jan K. Brueckner & Ann G. Largey, 2006. "Social Interaction and Urban Sprawl," Working Papers 060707, University of California-Irvine, Department of Economics.
  26. Robert W. Helsley & William C. Strange, 2007. "Urban interactions and spatial structure," Journal of Economic Geography, Oxford University Press, Oxford University Press, vol. 7(2), pages 119-138, March.
  27. Yannis M. Ioannides, 2012. "From Neighborhoods to Nations: The Economics of Social Interactions," Economics Books, Princeton University Press, Princeton University Press, edition 1, volume 1, number 9892.
  28. Marshall, Alfred, 1890. "The Principles of Economics," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, McMaster University Archive for the History of Economic Thought, number marshall1890.
  29. Harris, John R & Todaro, Michael P, 1970. "Migration, Unemployment & Development: A Two-Sector Analysis," American Economic Review, American Economic Association, American Economic Association, vol. 60(1), pages 126-42, March.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:osk:wpaper:1332. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Atsuko SUZUKI).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.