By explicitly considering the spatial dimension of local regional labor markets, we develop a simple dynamic model that explains the spatial correlation between unemployment rates. We then test this model by using UK local data. Our evidence shows a significant spatial dependence that has been...

The aim of this paper is to provide a new mechanism based on social interactions explaining why distance to jobs can have a negative impact on workers' labor-market outcomes, especially ethnic minorities. Building on Granovetter's idea that weak ties are superior to strong ties for providing...