Working Paper: CEPR ID: DP3731
Authors: Tony E. Smith; Yves Zenou
Abstract: The aim of this Paper is to provide a new mechanism for the spatial mismatch hypothesis. Spatial mismatch can here be the result of optimizing behaviour on the part of the labour market participants. In particular, the unemployed can choose low amounts of search and long-term unemployment if they reside far away from jobs. They choose voluntarily not to relocate close to jobs because the short-run gains (low land rent and large housing consumption) are big enough compared to the long-run gains of residing near jobs (higher probability of finding a job).
Keywords: Job Matching; Search Intensities; Urban Segregation
JEL Codes: D83; J64; R14
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| distance to jobs (R23) | search intensity (D83) |
| residential distance to jobs (R23) | search intensity (D83) |
| search intensity (D83) | probability of finding a job (J68) |
| residential distance to jobs (R23) | probability of finding a job (J68) |