Spatial mobility, social networks, and their effects on labor market outcomes

The aim of this thesis is to deepen the understanding of how economic agents’ geographical location and social networks affect labor market outcomes. We study the interactions between commuting, job location, and worker flows in the labor market. Building upon the urban search-matching and networks literature and using multicentric frameworks, we determine how the geographical distributions of job and worker flows determine the geographical distributions of (un)employment rates. First, we find that the workforce distribution has nonnegligible effects on unemployment rates, wages, and net output in a densely populated duocentric economy. Second, we study the scenario in which economic agents reside in two distinct job centers. By allowing workers to commute or relocate from one job center to the other, we find that in equilibrium the composition of the population and hence unemployment rates are affected, generating disparities. Last, in a polycentric configuration, we find that workers social networks affect their decisions about commuting distance. Workers who have a good social network (i.e., one composed of employed workers) commute less compared to those who have a bad social network (i.e., one composed of unemployed workers). These commuting distance decisions and social networks affect (un)employment rates.