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Notes, Comments, and Letters to the Editor. Dual labor markets, urban unemployment and multicentric cities

Notes, Comments, and Letters to the Editor. Dual labor markets, urban unemployment and multicentric cities
Notes, Comments, and Letters to the Editor. Dual labor markets, urban unemployment and multicentric cities
A two-sector model of urban employment is developed which focuses on the formation of a secondary sector in response to a primary-sector demand shock. The optimal location of this (single-firm) sector is shown to give rise to a multicentric urban spatial structure. Conditions are then established under which the new labor market equilibrium involves both a decrease in unemployment and an increase in net income for those unemployed. These results are extended to a case where all unemployment benefits are financed by local taxation of firms. Here it is shown that profit incentives may exist for the primary sector to subsidize entry of the secondary sector.
0022-0531
185-214
Smith, Tony E.
5447375a-2f26-4e65-9ad0-953d55a63c30
Zenou, Yves
f7c3b72f-b6b6-4550-8b0f-00a127af082e
Smith, Tony E.
5447375a-2f26-4e65-9ad0-953d55a63c30
Zenou, Yves
f7c3b72f-b6b6-4550-8b0f-00a127af082e

Smith, Tony E. and Zenou, Yves (1997) Notes, Comments, and Letters to the Editor. Dual labor markets, urban unemployment and multicentric cities. Journal of Economic Theory, 76 (1), 185-214. (doi:10.1006/jeth.1997.2296).

Record type: Article

Abstract

A two-sector model of urban employment is developed which focuses on the formation of a secondary sector in response to a primary-sector demand shock. The optimal location of this (single-firm) sector is shown to give rise to a multicentric urban spatial structure. Conditions are then established under which the new labor market equilibrium involves both a decrease in unemployment and an increase in net income for those unemployed. These results are extended to a case where all unemployment benefits are financed by local taxation of firms. Here it is shown that profit incentives may exist for the primary sector to subsidize entry of the secondary sector.

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Published date: September 1997

Identifiers

Local EPrints ID: 33078
URI: http://eprints.soton.ac.uk/id/eprint/33078
ISSN: 0022-0531
PURE UUID: fdcd89bc-f679-4afd-b04a-a0d39911ad0d

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Date deposited: 13 Dec 2007
Last modified: 15 Mar 2024 07:41

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Contributors

Author: Tony E. Smith
Author: Yves Zenou

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