Spatial Mismatch or Racial Mismatch?

David Neumark, Judith K. Hellerstein and Melissa McInerney , Journal of Urban Economics 64(2) , 464-479 , September 2008.

We contrast the spatial mismatch hypothesis with what we term the racial mismatch hypothesis – that the problem is not a lack of jobs, per se, where blacks live, but a lack of jobs where blacks live into which blacks are hired. We first report new evidence on the spatial mismatch hypothesis, using data from Census Long-Form respondents. We construct direct measures of the presence of jobs in detailed geographic areas, and find that these job density measures are related to employment of black male residents in ways that would be predicted by the spatial mismatch hypothesis – in particular that spatial mismatch is primarily an issue for low-skilled black male workers. We then look at mismatch along not only spatial lines but racial lines as well, by estimating the effects of job density measures that are disaggregated by race. We find that it is primarily black job density that influences black male employment, whereas white job density has little if any influence on their employment. The evidence implies that space alone plays a relatively minor role in low black male employment rates. 

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