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The effect of location on finding a job in the Paris region

  • Laurent Gobillon
  • Thierry Magnac
  • Harris Selod

Do spatial differences in unemployment duration reflect residential sorting or a true local effect? Focusing on the 1300 municipalities of the Paris region, we apply a methodology that disentangles individual and unspecified municipality effects. Estimating a proportional hazard model stratified by municipality and recovering a survival function for each municipality purged of individual observed heterogeneity, we show that local and individual characteristics add up in their contribution to unemployment duration. While only 30% of the spatial disparities in unemployment duration are explained by individual characteristics, 70% of the remaining disparities are captured by local indicators, mainly correlated with residential segregation.

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Article provided by John Wiley & Sons, Ltd. in its journal Journal of Applied Econometrics.

Volume (Year): 26 (2011)
Issue (Month): 7 (November)
Pages: 1079-1112

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Handle: RePEc:wly:japmet:v:26:y:2011:i:7:p:1079-1112
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