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Space And Unemployment: The Labour-Market Effects Of Spatial Mismatch

  • Brueckner, Jan
  • Zenou, Yves

The aim of this paper is to analyse the effects of suburban housing discrimination on the wages and unemployment rates of black workers. In a duocentric city with efficiency wages, it is shown that, when blacks experience suburban housing discrimination, they face a higher unemployment rate in the central city than in the suburbs, also earning lower wages in the centre. An increase in commuting costs is shown to raise both these disparities, and a number of other results are established. The analysis thus generates a link between housing-market discrimination and a seemingly unrelated phenomenon: unemployment in the labour market. In doing so, the paper provides new insight into the spatial mismatch hypothesis.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 2397.

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Date of creation: Mar 2000
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Handle: RePEc:cpr:ceprdp:2397
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  1. Peter Mieszkowski & Edwin S. Mills, 1993. "The Causes of Metropolitan Suburbanization," Journal of Economic Perspectives, American Economic Association, vol. 7(3), pages 135-147, Summer.
  2. Cutler, David M & Glaeser, Edward L, 1997. "Are Ghettos Good or Bad?," The Quarterly Journal of Economics, MIT Press, vol. 112(3), pages 827-72, August.
  3. Cutler, David & Vigdor, Jacob & Glaeser, Edward, 1999. "The Rise and Decline of the American Ghetto," Scholarly Articles 2770033, Harvard University Department of Economics.
  4. Richard Arnott, 1997. "Economic Theory and the Spatial Mismatch Hypothesis," Boston College Working Papers in Economics 390., Boston College Department of Economics.
  5. Price, Richard & Mills, Edwin, 1985. "Race and residence in earnings determination," Journal of Urban Economics, Elsevier, vol. 17(1), pages 1-18, January.
  6. Brueckner, Jan K. & Martin, Richard W., 1997. "Spatial mismatch: An equilibrium analysis," Regional Science and Urban Economics, Elsevier, vol. 27(6), pages 693-714, November.
  7. Martin, Richard W., 1997. "Job Decentralization with Suburban Housing Discrimination: An Urban Equilibrium Model of Spatial Mismatch," Journal of Housing Economics, Elsevier, vol. 6(4), pages 293-317, December.
  8. Smith, T. E. & Zenou, Y., . "Dual labor markets, urban unemployment, and multicentric cities," CORE Discussion Papers RP -1283, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  9. Helen F. Ladd, 1998. "Evidence on Discrimination in Mortgage Lending," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 41-62, Spring.
  10. Yinger, John, 1997. "Cash in Your Face: The Cost of Racial and Ethnic Discrimination in Housing," Journal of Urban Economics, Elsevier, vol. 42(3), pages 339-365, November.
  11. Edward L. Glaeser & Matthew E. Kahn & Jordan Rappaport, 2000. "Why Do the Poor Live in Cities?," NBER Working Papers 7636, National Bureau of Economic Research, Inc.
  12. Brueckner, Jan K. & Zenou, Yves, 1999. "Harris-Todaro models with a land market," Regional Science and Urban Economics, Elsevier, vol. 29(3), pages 317-339, May.
  13. Edwin S. Mills & Luan Sende Lubuele, 1997. "Inner Cities," Journal of Economic Literature, American Economic Association, vol. 35(2), pages 727-756, June.
  14. Coulson, N Edward & Laing, Derek & Wang, Ping, 2001. "Spatial Mismatch in Search Equilibrium," Journal of Labor Economics, University of Chicago Press, vol. 19(4), pages 949-72, October.
  15. Zenou, Y. & Smith, T. E., . "Efficiency wages, involuntary unemployment and urban spatial structure," CORE Discussion Papers RP -1171, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  16. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, vol. 74(3), pages 433-44, June.
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