Spatial Mismatch: From the Hypothesis to the Theories

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 centres. In this context, the spatial mismatch hypothesis argues that because the residential locations of minorities are disconnected from suburban job opportunities, low-skilled minorities residing in inner cities face adverse labour market outcomes. The reason why distance to jobs may be harmful to minorities has, however, long remained unclear, while the abundant but essentially empirical literature on spatial mismatch has lead to much controversy. The present work presents the main stylized facts associated with spatial mismatch and reviews the main theoretical models that started to emerge in the late 1990s.