"Neighborhood effects and job search behaviors"
co-authored with Florence Goffette-Nago, GATE-LSE & CNRS

Abstract :
This paper aims to test for the influence of interactions with neighbors on job search behaviors of unemployed individuals. Using data from the 2014-2019 French Labor Force Surveys, we implement a model of endogenous, contextual and group effects inspired from Manski (1993) and applied to job search intensity for different channels. We control for location endogeneity in a similar way as in Bayer et al. (2008) and tackle the reflection issue by using the approach proposed by Lee (2007) and developed by Boucher et. al. (2014). We find evidence of endogenous peer effects for all the job search channels, which indicates the existence of imitation or spread of information effects, particularly for job search through networks. We also find some contextual and group effects with regards to neighbors’ occupations. Such results underline the importance of being surrounded by neighbors with strong labor market connections, and suggest that local social interaction effects in job search could amplify labor market inequalities across neighborhoods.