A two-sector model of urban unemployment is developed which focuses on the formation of a secondary sector under conditions in which a demand shock in the primary sector leads to a sharp increase in unemployment. The optimal location in the secondary sector (treated as a single firm) is shown to...

We study labor market competition with heterogeneous firms and consumers. Worker types are continuously distributed within the population and a finite number of firms have specific skill requirements. Specific human capital investment is the cost of training a worker to be able to work for a...

We consider a continuum of unemployed workers ranked according to their unemployment duration. There are two industries, a high and a low technology one, which compete imperfectly on the labor market. Once employed, each individual must bear a training cost, which is proportional to his...

In this paper, we explore a simple model which focuses on the joint role of workers’ heterogeneity and imperfect competition in the endogeneous formation of labor market equilibria. We show that, compared to the competitive case, imperfect competition leads to a misallocation of workers and to...

The aim of the paper is to explore the formation of cities through labor specialization, gains to trade, a fixed cost for the transportation network, imperfect competition between firms and the commuting costs of consumers. The model uses a very general setting, allowing a multidimensional...

We propose a model where employers have two types of prejudices: racial and spatial discriminations. Because of the rst one, black workers have less chance than white workers to nd a job. Because of the second one, workers living closer to the city-center have less chances than suburban workers...

In a model of horizontal product differentiation, we show that local monopolies may exist under free entry when capital is perfectly mobile. In contrast both with the situation of restricted entry and with the zero-profit approach to free entry outcomes of Salop (1979), the unit profit rate of...

The labor market model is developed within an urban spatial context, where it is shown that effeciency-wage policies can lead to significant levels of involuntary unemployment. Commuting cost differences between workers and nonworkers tend to increase unemployment, and competition for land tends...

We consider a dual labor market with a continuum of heterogeneous workers differentiated by their ability of acquiring a specific skill. In the primary sector, jobs require firm-specific training and firms set efficiency wages. In the secondary sector, wages are competitive and no training is...

We consider a finite number of firms which compete imperfectly for heterogenous workers. Firms produce a homogeneous good sold on a competitive market and face demand-induced price fluc- tuations. It is then shown that unemployment may arise in equilibrium because of uncertainty on product...