Does city structure affect search and welfare?


Wasmer, Etienne and Zenou, Yves (2002) Does city structure affect search and welfare? Journal of Urban Economics, 51, (3), 515-541. (doi:10.1006/juec.2001.2256).

Download

Full text not available from this repository.

Original Publication URL: http://dx.doi.org/10.1006/juec.2001.2256

Description/Abstract

We develop a model in which workers' search efficiency is negatively affected by access to jobs. Workers' location in a city is endogenous and reflects a trade-off between commuting costs and the surplus associated with search. Different configurations emerge in equilibrium; notably, the unemployed workers may reside far away (segregated city) or close to jobs (integrated city). We prove that there exists a unique and stable market equilibrium in which both land and labor markets are solved for simultaneously. We find that, despite inefficient search in the segregated city equilibrium, the welfare difference between the two equilibria is not so large due to differences in commuting costs. We also show how a social planner can manipulate wages by subsidizing/taxing the transport costs and can accordingly restore the efficiency.

Item Type: Article
ISSNs: 0094-1190 (print)
Related URLs:
Keywords: job matching, urban land use, transportation policies
Subjects: H Social Sciences > HB Economic Theory
Divisions: University Structure - Pre August 2011 > School of Social Sciences > Economics
ePrint ID: 33068
Date Deposited: 15 May 2006
Last Modified: 27 Mar 2014 18:20
URI: http://eprints.soton.ac.uk/id/eprint/33068

Actions (login required)

View Item View Item