IDEAS home Printed from https://ideas.repec.org/p/bdr/borrec/844.html
   My bibliography  Save this paper

The Influence of Neighborhood Characteristics on Wages and Labor Supply in an Urban Context: The Case of a Latin-American City

Author

Listed:
  • Leonardo Fabio Morales
  • Lina Cardona-Sosa

Abstract

Using data from Medellín, second largest city in Colombia, we asses in this paper how a set of neighborhood characteristics determines wages and labor supply for workers in the city. We use GIS data to construct measures of the quality of environments where workers live. This paper focuses in the impact in labor supply and wages of the following set of characteristics: availability of public transportation, crime levels and density of economic activity. The empirical methodology consist of the estimation of linear equations for wages and worked hours, and we control for the selection of individuals into the neighborhoods they are observed. In order to do this we estimate in a first stage a probabilistic model of neighborhood selection from which selection correction terms are obtained; these correction terms and included in the linear equations for wage and worked hours in a second stage. In addition, we control for sample selection as well. We find that the endogeneity of the location decision tends to overestimate the magnitude of the effect of neighborhood characteristics on labor market outcomes. Nevertheless, the effect of some characteristics is still significant and important after we control for the possibility of selection into neighborhoods.

Suggested Citation

  • Leonardo Fabio Morales & Lina Cardona-Sosa, 2014. "The Influence of Neighborhood Characteristics on Wages and Labor Supply in an Urban Context: The Case of a Latin-American City," Borradores de Economia 844, Banco de la Republica de Colombia.
  • Handle: RePEc:bdr:borrec:844
    DOI: 10.32468/be.844
    as

    Download full text from publisher

    File URL: https://doi.org/10.32468/be.844
    Download Restriction: no

    File URL: https://libkey.io/10.32468/be.844?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Carlos Medina & Jorge Andrés Tamayo, 2011. "An Assessment of How Urban Crime and Victimization Affects Life Satisfaction," Borradores de Economia 640, Banco de la Republica de Colombia.
    2. Leonardo Fabio Morales, 2015. "Peer Effects on a Fertility Decision: an Application for Medellín, Colombia," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Spring 20), pages 119-159, February.
    3. Dujardin, Claire & Goffette-Nagot, Florence, 2010. "Neighborhood effects on unemployment?: A test à la Altonji," Regional Science and Urban Economics, Elsevier, vol. 40(6), pages 380-396, November.
    4. Zenou, Yves, 2002. "How do firms redline workers?," Journal of Urban Economics, Elsevier, vol. 52(3), pages 391-408, November.
    5. Carlos Medina & Jorge Andrés Tamayo & Christian Posso, 2013. "The Effect of Adult Criminals´ Spillovers On the Likelihood of Youths Becoming Criminals," Borradores de Economia 10461, Banco de la Republica.
    6. Lee, Lung-Fei, 1983. "Generalized Econometric Models with Selectivity," Econometrica, Econometric Society, vol. 51(2), pages 507-512, March.
    7. Zenou, Yves & Boccard, Nicolas, 2000. "Racial Discrimination and Redlining in Cities," Journal of Urban Economics, Elsevier, vol. 48(2), pages 260-285, September.
    8. François Bourguignon & Martin Fournier & Marc Gurgand, 2007. "Selection Bias Corrections Based On The Multinomial Logit Model: Monte Carlo Comparisons," Journal of Economic Surveys, Wiley Blackwell, vol. 21(1), pages 174-205, February.
    9. Lall, Somik V. & Mengistae, Taye, 2005. "The impact of business environment and economic geography on plant-level productivity : an analysis of Indian industry," Policy Research Working Paper Series 3664, The World Bank.
    10. Carlos Medina & Jorge Andrés Tamayo & Christian Posso, 2013. "The Effect of Adult Criminals’ Spillovers On the Likelihood of Youths Becoming Criminals," Borradores de Economia 755, Banco de la Republica de Colombia.
    11. Bruce A. Weinberg & Patricia B. Reagan & Jeffrey J. Yankow, 2004. "Do Neighborhoods Affect Hours Worked? Evidence from Longitudinal Data," Journal of Labor Economics, University of Chicago Press, vol. 22(4), pages 891-924, October.
    12. 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)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Leonardo Fabio Morales & Lina Cardona-Sosa, 2015. "Calidad de los vecindarios y oferta laboral femenina en un contexto urbano: un caso aplicado a la ciudad de Medellín," Borradores de Economia 12588, Banco de la Republica.

    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. Leonardo Fabio Morales & Lina Cardona-Sosa, 2015. "Calidad de los vecindarios y oferta laboral femenina en un contexto urbano: un caso aplicado a la ciudad de Medellín," Borradores de Economia 868, Banco de la Republica de Colombia.
    2. Olof Åslund & John Östh & Yves Zenou, 2010. "How important is access to jobs? Old question--improved answer," Journal of Economic Geography, Oxford University Press, vol. 10(3), pages 389-422, May.
    3. Alivon, Fanny & Guillain, Rachel, 2018. "Urban segregation and unemployment: A case study of the urban area of Marseille – Aix-en-Provence (France)," Regional Science and Urban Economics, Elsevier, vol. 72(C), pages 143-155.
    4. 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.
    5. Lea Eilers & Alfredo R. Paloyo & Peggy Bechara, 2022. "The effect of peer employment and neighborhood characteristics on individual employment," Empirical Economics, Springer, vol. 62(4), pages 1885-1908, April.
    6. 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.
    7. Ariu, Andrea & Breinlich, Holger & Corcos, Gregory & Mion, Giordano, 2019. "The interconnections between services and goods trade at the firm-level," Journal of International Economics, Elsevier, vol. 116(C), pages 173-188.
    8. Evan J. Miller-Tait & Sandeep Mohapatra & M. K. (Marty) Luckert & Brent M. Swallow, 2019. "Processing technologies for undervalued grains in rural India: on target to help the poor?," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 11(1), pages 151-166, February.
    9. Breustedt, Gunnar & Schulz, Norbert & Latacz-Lohmann, Uwe, 2013. "Kalibrierung von Vertragsnaturschutzprogrammen mittels eines zweistufigen Discrete-Choice-Experimentes," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 62(04), pages 1-17, November.
    10. Mathias Kuepié & Christophe J. Nordman, 2016. "Where Does Education Pay Off in Sub-Saharan Africa? Evidence from Two Cities of the Republic of Congo," Oxford Development Studies, Taylor & Francis Journals, vol. 44(1), pages 1-27, January.
    11. Guaracyane Lima Campelo & João Mário Santos De França & Emerson Luís Lemos Marinho, 2016. "Impacts Of Malnutrition On Labor Productivity: Empirical Evidences In Rural Brazil," Anais do XLII Encontro Nacional de Economia [Proceedings of the 42nd Brazilian Economics Meeting] 236, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics].
    12. Tito Boeri & Marta De Philippis & Eleonora Patacchini & Michele Pellizzari, 2015. "Immigration, Housing Discrimination and Employment," Economic Journal, Royal Economic Society, vol. 125(586), pages 82-114, August.
    13. Sergi Jiménez-Martín & Cristina Prieto, 2012. "The trade-off between formal and informal care in Spain," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 13(4), pages 461-490, August.
    14. Aleksandra Anić & Gorana Krstić, 2019. "What Lies Behind The Gender Wage Gap In Serbia?," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 64(223), pages 137-170, October –.
    15. Zenou, Yves, 2003. "Urban Labour Economic Theory," CEPR Discussion Papers 4029, C.E.P.R. Discussion Papers.
    16. Stéphane Couture & Serge Garcia & Arnaud Reynaud, 2009. "Household Energy Choices and Fuelwood Consumption: An Econometric Approach to the French Data," LERNA Working Papers 09.08.284, LERNA, University of Toulouse.
    17. Timothy Park & Ashok K. Mishra & Shawn J. Wozniak, 2014. "Do farm operators benefit from direct to consumer marketing strategies?," Agricultural Economics, International Association of Agricultural Economists, vol. 45(2), pages 213-224, March.
    18. Ross, Stephen L. & Zenou, Yves, 2008. "Are shirking and leisure substitutable? An empirical test of efficiency wages based on urban economic theory," Regional Science and Urban Economics, Elsevier, vol. 38(5), pages 498-517, September.
    19. Yi CHEN & Sylvie DEMURGER & Martin FOURNIER, 2004. "Différentiels salariaux, segmentation et discrimination à l’égard des femmes sur le marché du travail chinois," Working Papers 200426, CERDI.
    20. Hansen, Henrik & Rand, John & Win, Ngu Wah, 2022. "The gender wage gap in Myanmar: Adding insult to injury?," Journal of Asian Economics, Elsevier, vol. 81(C).

    More about this item

    JEL classification:

    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:bdr:borrec:844. See general information about how to correct material in RePEc.

    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: Clorith Angélica Bahos Olivera (email available below). General contact details of provider: https://edirc.repec.org/data/brcgvco.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.