Social origins of a work ethic : norms, mobility and urban unemployment

Abstract

Neighbourhood effects and worker mobility have been proposed as explanations for the pattern of employment in cities. This paper presents a the oretical framework within which the joint impact of these two factors can be analyzed. The evolution of unemployment patterns is modelled as a stochastic process, where workers sometimes make employment decisions influenced by local norms, and sometimes decisions of where to live based on neighbourhood characteristics. A long run outcome of full employment and complete segregation is found to be robust to a wide range of process specifications. More nonsegregated long run outcomes are possible if mobility decisions are based on neighbourhood employment rates than if they are based on other neighbourhood characteristics.