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Why Work Disappears: Neighborhood Racial Composition and Employers' Relocation Intentions


  • John Iceland
  • David R. Harris


Over the past 25 years there has been a dramatic decline in the number of quality jobs located in central cities. This has disproportionately had an adverse impact on the economic prospects of African-Americans. One issue that has been neglected by most urban poverty researchers is the reasons why firms move. Using data from a representative sample of employers in Boston, Atlanta, Los Angeles, and Detroit, we assess the extent to which firms in these cities are more likely to express relocation intentions in neighborhoods with an increasing proportion of African American residents. Results indicate that firms in Boston and Los Angeles are indeed considerably more likely to express desires to flee neighborhoods with an increasing proportion of black residents. This exacerbates spatial mismatches in black urban communities. In Detroit and Atlanta, race displays little effect on firms' relocation intentions. Perhaps firms which are sensitive to race have long since relocated in Detroit and Atlanta, given their long histories of black/white balkanization and conflict.

Suggested Citation

  • John Iceland & David R. Harris, 1998. "Why Work Disappears: Neighborhood Racial Composition and Employers' Relocation Intentions," JCPR Working Papers 45, Northwestern University/University of Chicago Joint Center for Poverty Research.
  • Handle: RePEc:wop:jopovw:45

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    References listed on IDEAS

    1. Holzer Harry J. & Ihlanfeldt Keith R. & Sjoquist David L., 1994. "Work, Search, and Travel among White and Black Youth," Journal of Urban Economics, Elsevier, vol. 35(3), pages 320-345, May.
    2. Schmenner, Roger W. & Huber, Joel C. & Cook, Randall L., 1987. "Geographic differences and the location of new manufacturing facilities," Journal of Urban Economics, Elsevier, vol. 21(1), pages 83-104, January.
    3. Zax, Jeffrey S & Kain, John F, 1996. "Moving to the Suburbs: Do Relocating Companies Leave Their Black Employees Behind?," Journal of Labor Economics, University of Chicago Press, vol. 14(3), pages 472-504, July.
    4. Ihlanfeldt, Keith R. & Sjoquist, David L., 1989. "The impact of job decentralization on the economic welfare of central city blacks," Journal of Urban Economics, Elsevier, vol. 26(1), pages 110-130, July.
    5. Yinger, John, 1986. "Measuring Racial Discrimination with Fair Housing Audits: Caught in the Act," American Economic Review, American Economic Association, vol. 76(5), pages 881-893, December.
    6. Harry J. Holzer & Keith R. Ihlanfeldt, 1996. "Spatial factors and the employment of blacks at the firm level," New England Economic Review, Federal Reserve Bank of Boston, issue May, pages 65-86.
    7. David T. Ellwood, 1986. "The Spatial Mismatch Hypothesis: Are There Teenage Jobs Missing in the Ghetto?," NBER Chapters,in: The Black Youth Employment Crisis, pages 147-190 National Bureau of Economic Research, Inc.
    8. Carlton, Dennis W, 1983. "The Location and Employment Choices of New Firms: An Econometric Model with Discrete and Continuous Endogenous Variables," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 440-449, August.
    9. Zax, Jeffrey S., 1991. "Compensation for commutes in labor and housing markets," Journal of Urban Economics, Elsevier, vol. 30(2), pages 192-207, September.
    10. Paul D. Gottlieb, 1995. "Residential Amenities, Firm Location and Economic Development," Urban Studies, Urban Studies Journal Limited, vol. 32(9), pages 1413-1436, November.
    11. 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.
    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.
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