2006–2010

Efficiency Wages and Unemployment in Cities: The Case of High-Relocation Costs

Reprint No. 2006:2

Author(s): Yves ZenouYear: 2006 Title: Regional Science and Urban Economics Volume (No.): 36 (1) Pages: 49–71


We develop an urban model in which all jobs are located in the Central Business District (CBD) and workers, who have high relocation costs, optimally choose their residence between the CBD and the city fringe. We consider two information structures. In the first case, firms perfectly observe the residential location of all workers, while, in the second one, firms do not observe where workers live. In the perfect information equilibrium, we show that the efficiency wage is increasing with distance to jobs. We also demonstrate that workers are better off and landlords worse off under the perfect information equilibrium.


Reference:
Zenou, Yves (2006), "Efficiency Wages and Unemployment in Cities: The Case of High-Relocation Costs". Regional Science and Urban Economics 36(1), 49–71.

Elgar Companion to

Social Capital and Health

Martin Ljunge okt 2018.jpg

Martin Ljunge, IFN, is the author of a chapter, "Trust promotes health: addressing reverse causality by studying children of immigrants", in a new book edited by Sherman Folland and Eric Nauenberg. The cutting edge of research is presented, covering the ever-expanding social capital field.

About the book

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To present ongoing research informal brown-bag seminars are held on Mondays at 11:30 am. This is an opportunity for IFN researchers to test ideas and results.

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In addition, IFN organizes seminars open to the public. Topics for these are derived from the IFN research.

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