The empirical literature has found evidence of locational sorting of workers by wage or skill. We show that such sorting can be driven by asymmetric information in the labor market, specifically when firms do not know if a particular worker is of high or low skill. In a model with two types and...

The tomahawk bifurcation is used by Fujita et al. [Fujita, M., Krugman P., Venables A.J., 1999, The Spatial Economy: Cities, Regions, and International Trade, MIT Press: Cambridge, MA.] in a model with two regions to explain the formation of a core-periphery urban pattern from an initial uniform...