Since the 1950s, there has been a steady decentralization of entry-level jobs towards the suburbs of American cities, while racial minorities ?and particularly blacks? have remained in city centers. In this context, the spatial mismatch hypothesis argues that because the residential locations of...

Recent theoretical work has examined the spatial distribution of unemployment using the efficiency wage model as the mechanism by which unemployment arises in the urban economy. This paper extends the standard efficiency wage model in order to allow for behavioral substitution between leisure...