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Reassessing the Spatial Mismatch Hypothesis

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  • David Card
  • Jesse Rothstein
  • Moises Yi

Abstract

Using Longitudinal Employer-Household Dynamics data, we demonstrate several facts that are not consistent with the "spatial mismatch" hypothesis that residential segregation and uneven distribution of jobs limit Black workers' opportunities. We show that (a) there is no Black-White gap in the firm premium component of wages in an Abowd-Kramarz-Margolis wage decomposition; (b) there are both more jobs and more good jobs within commuting distance of Black than White workers; and (c) Black workers' commutes are shorter. We conclude that geographic proximity to good jobs is not a major source of racial earnings gaps in major US cities today.

Suggested Citation

  • David Card & Jesse Rothstein & Moises Yi, 2024. "Reassessing the Spatial Mismatch Hypothesis," AEA Papers and Proceedings, American Economic Association, vol. 114, pages 221-225, May.
    • Handle: RePEc:aea:apandp:v:114:y:2024:p:221-25
    DOI: 10.1257/pandp.20241112
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    References listed on IDEAS

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    1. Paul Offner & Daniel H. Saks, 1971. "A Note on John Kain's "Housing Segregation, Negro Employment and Metropolitan Decentralization"," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 85(1), pages 147-160.
    2. Ashenfelter, Orley, 1972. "Racial Discrimination and Trade Unionism," Journal of Political Economy, University of Chicago Press, vol. 80(3), pages 435-464, May-June.
    3. David Card & Jesse Rothstein & Moises Yi, 2024. "Industry Wage Differentials: A Firm-Based Approach," Journal of Labor Economics, University of Chicago Press, vol. 42(S1), pages 11-59.
    4. John M. Abowd & Francis Kramarz & David N. Margolis, 1999. "High Wage Workers and High Wage Firms," Econometrica, Econometric Society, vol. 67(2), pages 251-334, March.
    5. Joseph D. Mooney, 1969. "Housing Segregation, Negro Employment and Metropolitan Decentralization: An Alternative Perspective," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 83(2), pages 299-311.
    6. Glaeser, Edward L. & Hanushek, Eric A. & Quigley, John M., 2004. "Opportunities, race, and urban location: the influence of John Kain," Journal of Urban Economics, Elsevier, vol. 56(1), pages 70-79, July.
    7. David T. Ellwood, 1986. "The Spatial Mismatch Hypothesis: Are There Teenage Jobs Missing in the Ghetto?," NBER Chapters, in: The Black Youth Employment Crisis, pages 147-190, National Bureau of Economic Research, Inc.
    8. John F. Kain, 1968. "Housing Segregation, Negro Employment, and Metropolitan Decentralization," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 82(2), pages 175-197.
    9. Harry J. Holzer, 1991. "The Spatial Mismatch Hypothesis: What Has the Evidence Shown?," Urban Studies, Urban Studies Journal Limited, vol. 28(1), pages 105-122, February.
    10. François Gerard & Lorenzo Lagos & Edson Severnini & David Card, 2021. "Assortative Matching or Exclusionary Hiring? The Impact of Employment and Pay Policies on Racial Wage Differences in Brazil," American Economic Review, American Economic Association, vol. 111(10), pages 3418-3457, October.
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    More about this item

    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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