On-the-Job Search and City Structure

Aico van Vuuren

No 15-016/VI, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: We investigate an equilibrium search model in which the search frictions are increasing with the distance to the central business district allowing for on-the-job search and endogenous (monopsony) wage formation and land allocation. We find that there are many different possible outcomes with respect to the location of unemployed workers within a metropolitan area. The city structure of the decentralized market is only efficient when commuting costs of the employed workers are large. Policies reducing the rental costs of unemployed workers for locations close to the central business district can potentially increase welfare.

Keywords: Search; city structure; urban economics (search for similar items in EconPapers)
JEL-codes: J42 J60 J64 R10 (search for similar items in EconPapers)
Date: 2015-02-02
New Economics Papers: this item is included in nep-dge and nep-ure
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Related works:
Working Paper: On-the-job search and city structure (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20150016

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