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From Rivers To Roads: Spatial Mismatch And Inequality Of Opportunity In Urban Labor Markets Of A Megacity

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  • EDUARDO AMARAL HADDAD
  • ANA MARIA BONOMI BARUFI

Abstract

The spatial mismatch between residential locations and jobs can be particularly relevant for low-skilled individuals. In this paper, we first explore such phenomenon from the perspective of the distance of the residence to the geographic concentration of jobs, and locational disadvantages of the urban form itself. Such unequal conditions in the labor market present a great challenge for the spatial sustainability of the multiple equilibria achieved simultaneously at the labor and the housing markets. We estimate the main aspects that influence wage differentials among individuals, focusing on the role of accessibility on labor market outcomes. We suggest the inclusion of geographical characteristics as instruments to deal with endogeneity problems that arise in the estimation of urban price models. Our strategy is based on the inclusion of a specific geographic/historic variable as instrument, namely the river shore access to the first school built by the Jesuits in São Paulo, the city’s founding location. Geography acted as a determinant of the location of the transportation infrastructure in the region, so that the road and rail networks in the city present a strong spatial correlation with pre-urban “waterways”. Nowadays, the vast majority of rivers and creeks are covered with asphalt and cement, and economic agents are practically unaware of their existence.
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  • Eduardo Amaral Haddad & Ana Maria Bonomi Barufi, 2018. "From Rivers To Roads: Spatial Mismatch And Inequality Of Opportunity In Urban Labor Markets Of A Megacity," Anais do XLIV Encontro Nacional de Economia [Proceedings of the 44th Brazilian Economics Meeting] 158, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics].
    • Handle: RePEc:anp:en2016:158
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    Cited by:

    1. Amaral Haddad, Eduardo & Lozano-Gracia, Nancy & Germani, Eduardo & Vieira, Renato & Nakamura, Shohei & Skoufias, Emmanuel & Bianchi Alves, Bianca, 2018. "Mobility in Cities: Distributional Impact Analysis of Transportation Improvement in São Paulo Metropolitan Region," TD NEREUS 4-2018, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    2. Haddad, Eduardo Amaral & Lozano-Gracia, Nancy & Germani, Eduardo & Vieira, Renato S. & Nakamura, Shohei & Skoufias, Emmanuel & Alves, Bianca Bianchi, 2019. "Mobility in cities: Distributional impact analysis of transportation improvements in São Paulo Metropolitan Region," Transport Policy, Elsevier, vol. 73(C), pages 125-142.
    3. Barros Antunes Campos, Rodger & Azzoni, Carlos Roberto, 2019. "Estimating the Intra-Urban Wage Premium," TD NEREUS 4-2019, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    4. Bonomi Barufi, Ana Maria & Amaral Haddad, Eduardo, 2016. "Spatial Mismatch, Wages and Unemployment in Brazilian Metropolitan Areas," TD NEREUS 9-2016, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).

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    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation

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