Ethnic Differentials on the Labor Market in the Presence of Asymmetric Spatial Sorting

Rathelot, Roland. Ethnic Differentials on the Labor Market in the Presence of Asymmetric Spatial Sorting: Set Identification and Estimation. Regional Science and Urban Economics, 48 (1), pp. 154-167, September 2014.

This paper aims to isolate the ethnic gap on the labor market that can be attributed to ethnicity and not to differences in individual characteristics or residential location. Controlling for residential location is important as ethnic minorities often live in distressed neighborhoods. It is also challenging because spatial sorting is likely to differ across ethnicities because of labor- or housing-market discrimination. This paper shows that controlling for neighborhoods and observed individual characteristics fails to provide a consistent estimate for the component of the gap accountable to ethnicity only. However, under some assumptions, the quantity of interest is set identified even when heterogeneous sorting patterns across ethnicities are allowed for and the set estimate can still be informative. A two-step estimation method is presented and applied to explain the ethnic employment differential in France, between French individuals of North African ancestry and those with non-immigrant parents. Most of the gap is not due to differences in residential location or individual characteristics, but rather to ethnicity itself.

Do Labor Market Policies have Displacement Effects?

Crépon, Bruno, Esther Duflo, Marc Gurgand, Roland Rathelot and Philippe Zamora. Do Labor Market Policies have Displacement Effects? Evidence from a Clustered Randomized Experiment. Quarterly Journal of Economics, 128(2), pp. 531-580, May 2013

This article reports the results from a randomized experiment designed to evaluate the direct and indirect (displacement) impacts of job placement assistance on the labor market outcomes of young, educated job seekers in France. We use a two-step design. In the first step, the proportions of job seekers to be assigned to treatment (0%, 25%, 50%, 75%, or 100%) were randomly drawn for each of the 235 labor markets (e.g., cities) participating in the experiment. Then, in each labor market, eligible job seekers were randomly assigned to the treatment, following this proportion. After eight months, eligible, unemployed youths who were assigned to the program were significantly more likely to have found a stable job than those who were not. But these gains are transitory, and they appear to have come partly at the expense of eligible workers who did not benefit from the program, particularly in labor markets where they compete mainly with other educated workers, and in weak labor markets. Overall, the program seems to have had very little net benefits.

Policy briefs “Job Placement or Displacement”:
Read J-PAL Policy Brief
Read VoxEU column

Local Ethnic Composition and Natives’ and Immigrants’ Geographic Mobility in France

Rathelot, Roland and Mirna Safi. Local Ethnic Composition and Natives’ and Immigrants’ Geographic Mobility in France, 1982-1999. American Sociological Review, 79(1), pp. 17-42, February 2014

This article provides empirical results on patterns of native and immigrant geographic mobility in France. Using longitudinal data, we measure mobility from one French municipality (commune) to another over time and estimate the effect of the initial municipality’s ethnic composition on the probability of moving out. These data allow us to use panel techniques to correct for biases related to selection based on geographic and individual unobservables. Our findings tend to discredit the hypothesis of a “white flight” pattern in residential mobility dynamics in France. Some evidence does show ethnic avoidance mechanisms in natives’ relocating. We also find a strong negative and highly robust effect of co-ethnics’ presence on immigrants’ geographic mobility.

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