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We develop a model in which blacks' ethnic preferences can lead to adverse labor-market outcomes. Because of these preferences, we show that multiple equilibria emerge: they correspond to different urban structures observed in the US. By incorporating in this spatial structure a simple search...

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...