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On-the-Job Search and City Structure

Author

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  • Aico van Vuuren

    (VU University Amsterdam)

Abstract

We investigate an equilibrium search model in which the search frictions are increasing with the distance to the central business district allowing for on-the-job search and endogenous (monopsony) wage formation and land allocation. We find that there are many different possible outcomes with respect to the location of unemployed workers within a metropolitan area. The city structure of the decentralized market is only efficient when commuting costs of the employed workers are large. Policies reducing the rental costs of unemployed workers for locations close to the central business district can potentially increase welfare.

Suggested Citation

  • Aico van Vuuren, 2015. "On-the-Job Search and City Structure," Tinbergen Institute Discussion Papers 15-016/VI, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20150016
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    References listed on IDEAS

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    1. 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.
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    More about this item

    Keywords

    Search; city structure; urban economics;
    All these keywords.

    JEL classification:

    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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