DP3731 Spatial Mismatch, Search Effort and Urban Spatial Structure

Author(s): Anthony A. Smith Jr, Yves Zenou
Publication Date: February 2003
Keyword(s): job matching, MTO, search intensities, urban segregation
JEL(s): D83, J64, R14
Programme Areas: Labour Economics
Link to this Page: www.cepr.org/active/publications/discussion_papers/dp.php?dpno=3731

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).