Brueckner, Jan K. and Zenou, Yves
Space and unemployment: the labor-market effects of spatial mismatch
Journal of Labor Economics, 21, (1), .
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The aim of this article is to analyze the effects of housing discrimination on the wages and unemployment rates of black workers. The unemployment effect is first analyzed using a simple minimum-wage model. An efficiency-wage model is then adopted in order to endogenize both unemployment and wages. Under both models, suburban housing discrimination leads to a higher unemployment rate for blacks in the central city than in the suburbs. Under the efficiency-wage model, black wages are also lower in the center. The analysis thus generates a link between unemployment and a seemingly unrelated phenomenon: racial discrimination in the housing market.
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