IDEAS home Printed from https://ideas.repec.org/a/ecj/econjl/v116y2006i514p1057-1087.html
   My bibliography  Save this article

City Structure, Job Search and Labour Discrimination: Theory and Policy Implications

Author

Listed:
  • Harris Selod
  • Yves Zenou

Abstract

We consider a search-matching model in which black workers are discriminated against and the job arrival rates of all workers depend on social networks as well as distance to jobs. Location choices are mainly driven by racial preferences. There are multiple equilibria and we show that all workers are in general better off in the equilibrium where blacks are close to jobs. We also show that, in cities where black workers reside far away from jobs, the optimal policy is to impose higher quotas or employment subsidies than in cities where they live close to jobs. Copyright 2006 The Author(s). Journal compilation Royal Economic Society 2006.

Suggested Citation

  • Harris Selod & Yves Zenou, 2006. "City Structure, Job Search and Labour Discrimination: Theory and Policy Implications," Economic Journal, Royal Economic Society, vol. 116(514), pages 1057-1087, October.
  • Handle: RePEc:ecj:econjl:v:116:y:2006:i:514:p:1057-1087
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Harry J. Holzer & Keith R. Ihlanfeldt, 1998. "Customer Discrimination and Employment Outcomes for Minority Workers," The Quarterly Journal of Economics, Oxford University Press, vol. 113(3), pages 835-867.
    2. Calvo-Armengol, Antoni & Zenou, Yves, 2005. "Job matching, social network and word-of-mouth communication," Journal of Urban Economics, Elsevier, vol. 57(3), pages 500-522, May.
    3. Christopher A. Pissarides & Barbara Petrongolo, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June.
    4. Rogers, Cynthia L., 1997. "Job Search and Unemployment Duration: Implications for the Spatial Mismatch Hypothesis," Journal of Urban Economics, Elsevier, vol. 42(1), pages 109-132, July.
    5. Fujita,Masahisa, 1991. "Urban Economic Theory," Cambridge Books, Cambridge University Press, number 9780521396455, December.
    6. Mortensen, D. T. & Vishwanath, T., 1995. "Personal contacts and earnings: It is who you know!," Labour Economics, Elsevier, vol. 2(1), pages 103-104, March.
    7. Wasmer, Etienne & Zenou, Yves, 2006. "Equilibrium search unemployment with explicit spatial frictions," Labour Economics, Elsevier, vol. 13(2), pages 143-165, April.
    8. Harry J. Holzer, 1998. "Why Do Small Establishments Hire Fewer Blacks Than Large Ones?," Journal of Human Resources, University of Wisconsin Press, vol. 33(4), pages 896-914.
    9. Stoll, Michael A., 1999. "Spatial Job Search, Spatial Mismatch, and the Employment and Wages of Racial and Ethnic Groups in Los Angeles," Journal of Urban Economics, Elsevier, vol. 46(1), pages 129-155, July.
    10. George A. Akerlof & Rachel E. Kranton, 2002. "Identity and Schooling: Some Lessons for the Economics of Education," Journal of Economic Literature, American Economic Association, vol. 40(4), pages 1167-1201, December.
    11. David M. Cutler & Edward L. Glaeser & Jacob L. Vigdor, 1999. "The Rise and Decline of the American Ghetto," Journal of Political Economy, University of Chicago Press, vol. 107(3), pages 455-506, June.
    12. Wahba, Jackline & Zenou, Yves, 2005. "Density, social networks and job search methods: Theory and application to Egypt," Journal of Development Economics, Elsevier, vol. 78(2), pages 443-473, December.
    13. Glenn C. Loury, 2000. "Social Exclusion and Ethnic Groups: The Challenge to Economics," Boston University - Institute for Economic Development 106, Boston University, Institute for Economic Development.
    14. Ihlanfeldt, Keith R., 1997. "Information on the Spatial Distribution of Job Opportunities within Metropolitan Areas," Journal of Urban Economics, Elsevier, vol. 41(2), pages 218-242, March.
    15. Courant, Paul N. & Yinger, John, 1977. "On models of racial prejudice and urban residential structure," Journal of Urban Economics, Elsevier, vol. 4(3), pages 272-291, July.
    16. Battu, Harminder & Mwale, McDonald & Zenou, Yves, 2003. "Do Oppositional Identities Reduce Employment for Ethnic Minorities?," IZA Discussion Papers 721, Institute of Labor Economics (IZA).
    17. Christopher A. Pissarides, 2000. "Equilibrium Unemployment Theory, 2nd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262161877.
    18. Montgomery, James D, 1991. "Social Networks and Labor-Market Outcomes: Toward an Economic Analysis," American Economic Review, American Economic Association, vol. 81(5), pages 1407-1418, December.
    19. Jackson, Matthew O. & Calvo, Antoni, 2002. "Social Networks in Determing Employment and Wages: Patterns, Dynamics, and Inequality," Working Papers 1149, California Institute of Technology, Division of the Humanities and Social Sciences.
    20. Holzer, Harry J, 1987. "Informal Job Search and Black Youth Unemployment," American Economic Review, American Economic Association, vol. 77(3), pages 446-452, June.
    21. George C. Galster, 1990. "White Flight from Racially Integrated Neighbourhoods in the 1970s: the Cleveland Experience," Urban Studies, Urban Studies Journal Limited, vol. 27(3), pages 385-399, June.
    22. Laurent Gobillon & Harris Selod & Yves Zenou, 2002. "Spatial Mismatch : From the Hypothesis of the Theories," Working Papers 2002-57, Center for Research in Economics and Statistics.
    23. David Austen-Smith & Roland G. Fryer, 2005. "An Economic Analysis of "Acting White"," The Quarterly Journal of Economics, Oxford University Press, vol. 120(2), pages 551-583.
    24. Wasmer, Etienne & Zenou, Yves, 2002. "Does City Structure Affect Job Search and Welfare?," Journal of Urban Economics, Elsevier, vol. 51(3), pages 515-541, May.
    25. Leonard, Jonathan S, 1990. "The Impact of Affirmative Action Regulation and Equal Employment Law on Black Employment," Journal of Economic Perspectives, American Economic Association, vol. 4(4), pages 47-63, Fall.
    26. Holzer, Harry J, 1988. "Search Method Use by Unemployed Youth," Journal of Labor Economics, University of Chicago Press, vol. 6(1), pages 1-20, January.
    27. Ihlanfeldt, Keith R. & Scafidi, Benjamin, 2002. "Black Self-Segregation as a Cause of Housing Segregation: Evidence from the Multi-City Study of Urban Inequality," Journal of Urban Economics, Elsevier, vol. 51(2), pages 366-390, March.
    28. George A. Akerlof, 1997. "Social Distance and Social Decisions," Econometrica, Econometric Society, vol. 65(5), pages 1005-1028, September.
    29. George A. Akerlof & Rachel E. Kranton, 2000. "Economics and Identity," The Quarterly Journal of Economics, Oxford University Press, vol. 115(3), pages 715-753.
    30. Holzer, Harry J. & Reaser, Jess, 2000. "Black Applicants, Black Employees, and Urban Labor Market Policy," Journal of Urban Economics, Elsevier, vol. 48(3), pages 365-387, November.
    31. Borjas, George J., 1998. "To Ghetto or Not to Ghetto: Ethnicity and Residential Segregation," Journal of Urban Economics, Elsevier, vol. 44(2), pages 228-253, September.
    32. Kanemoto, Yoshitsugu, 1980. "Theories of urban externalities," MPRA Paper 24614, University Library of Munich, Germany.
    33. Giorgio Topa, 2001. "Social Interactions, Local Spillovers and Unemployment," Review of Economic Studies, Oxford University Press, vol. 68(2), pages 261-295.
    34. Mortensen, Dale T. & Pissarides, Christopher A., 1999. "New developments in models of search in the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 39, pages 2567-2627, Elsevier.
    35. Schelling, Thomas C, 1969. "Models of Segregation," American Economic Review, American Economic Association, vol. 59(2), pages 488-493, May.
    36. Calvo-Armengol, Antoni, 2004. "Job contact networks," Journal of Economic Theory, Elsevier, vol. 115(1), pages 191-206, March.
    37. David M. Cutler & Edward L. Glaeser, 1997. "Are Ghettos Good or Bad?," The Quarterly Journal of Economics, Oxford University Press, vol. 112(3), pages 827-872.
    38. David Austen-Smith & Roland G. Fryer, 2003. "The Economics of 'Acting White'," NBER Working Papers 9904, National Bureau of Economic Research, Inc.
    39. Yinger, John, 1976. "Racial prejudice and racial residential segregation in an urban model," Journal of Urban Economics, Elsevier, vol. 3(4), pages 383-396, October.
    40. Weinberg, Bruce A., 2000. "Black Residential Centralization and the Spatial Mismatch Hypothesis," Journal of Urban Economics, Elsevier, vol. 48(1), pages 110-134, July.
    41. John F. Kain, 1968. "Housing Segregation, Negro Employment, and Metropolitan Decentralization," The Quarterly Journal of Economics, Oxford University Press, vol. 82(2), pages 175-197.
    42. 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.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Selod, Harris & Zenou, Yves, 2003. "Does City Structure Affect the Labor Market Outcomes of Black Workers?," IZA Discussion Papers 928, Institute of Labor Economics (IZA).
    2. Battu, Harminder & Seaman, Paul & Zenou, Yves, 2011. "Job contact networks and the ethnic minorities," Labour Economics, Elsevier, vol. 18(1), pages 48-56, January.
    3. Laurent Gobillon & Harris Selod & Yves Zenou, 2007. "The Mechanisms of Spatial Mismatch," Urban Studies, Urban Studies Journal Limited, vol. 44(12), pages 2401-2427, November.
    4. Zenou, Yves, 2009. "Search in cities," European Economic Review, Elsevier, vol. 53(6), pages 607-624, August.
    5. Picard, Pierre M. & Zenou, Yves, 2018. "Urban spatial structure, employment and social ties," Journal of Urban Economics, Elsevier, vol. 104(C), pages 77-93.
    6. Battu, Harminder & Mwale, McDonald & Zenou, Yves, 2003. "Do Oppositional Identities Reduce Employment for Ethnic Minorities?," IZA Discussion Papers 721, Institute of Labor Economics (IZA).
    7. Harminder Battu & McDonald Mwale & Yves Zenou, 2007. "Oppositional identities and the labor market," Journal of Population Economics, Springer;European Society for Population Economics, vol. 20(3), pages 643-667, July.
    8. Smith, Tony E. & Zenou, Yves, 2003. "Spatial mismatch, search effort, and urban spatial structure," Journal of Urban Economics, Elsevier, vol. 54(1), pages 129-156, July.
    9. Laurent Gobillon & Harris Selod & Yves Zenou, 2002. "Spatial Mismatch : From the Hypothesis of the Theories," Working Papers 2002-57, Center for Research in Economics and Statistics.
    10. Picard, Pierre M. & Zenou, Yves, 2015. "Urban Spatial Structure, Employment and Social Ties: European versus American Cities," IZA Discussion Papers 9166, Institute of Labor Economics (IZA).
    11. Andrea Galeotti & Luca Paolo Merlino, 2014. "Endogenous Job Contact Networks," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 55(4), pages 1201-1226, November.
    12. Laurent Gobillon & Thierry Magnac & Harris Selod, 2011. "The effect of location on finding a job in the Paris region," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 26(7), pages 1079-1112, November.
    13. Laurent Gobillon & Harris Selod, 2007. "The Effects of Segregation and Spatial Mismatch on Unemployment : Evidence from France," Working Papers 2007-04, Center for Research in Economics and Statistics.
    14. Topa, Giorgio & Zenou, Yves, 2015. "Neighborhood and Network Effects," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 561-624, Elsevier.
    15. Wasmer, Etienne & Zenou, Yves, 2006. "Equilibrium search unemployment with explicit spatial frictions," Labour Economics, Elsevier, vol. 13(2), pages 143-165, April.
    16. Harris Selod & Laurent Gobillon, 2007. "Les déterminants locaux du chômage en région parisienne," Économie et Prévision, Programme National Persée, vol. 180(4), pages 19-38.
    17. Calvo-Armengol, Antoni & Zenou, Yves, 2005. "Job matching, social network and word-of-mouth communication," Journal of Urban Economics, Elsevier, vol. 57(3), pages 500-522, May.
    18. 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, vol. 116(6), pages 1150-1196, December.
    19. Zenou, Yves, 2013. "Spatial versus social mismatch," Journal of Urban Economics, Elsevier, vol. 74(C), pages 113-132.
    20. Wasmer, Etienne & Zenou, Yves, 1999. "Does Space Affect Search? A Theory of Local Unemployment," CEPR Discussion Papers 2157, C.E.P.R. Discussion Papers.

    More about this item

    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ecj:econjl:v:116:y:2006:i:514:p:1057-1087. 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: . General contact details of provider: https://edirc.repec.org/data/resssea.html .

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley-Blackwell Digital Licensing or Christopher F. Baum (email available below). General contact details of provider: https://edirc.repec.org/data/resssea.html .

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.