Residential Segregation and Unemployment: The Case of Brussels

This paper investigates the causal effects of the spatial organisation of Brussels on unemployment propensities. Using census data at the individual level, the unemployment probability of young adults is estimated while taking into account personal, household and neighbourhood characteristics. The endogeneity of residential locations is solved by restricting the sample to young adults residing with their parents; the potential remaining bias is evaluated by conducting a sensitivity analysis. The results suggest that the neighbourhood of residence significantly increases a youngster's probability of being unemployed, a result which is quite robust to the presence of both observed and unobserved parental covariates.