Spatial Effects of the Minimum Wage (Job Market Paper)

Abstract:

Despite significant differences across local labor market outcomes within countries, most policies are set at the national level. This paper examines the reallocation effects of uniform minimum wages across heterogeneous local labor markets. To achieve this, I introduce a spatial general equilibrium model with migration dynamics and job market frictions. By adjusting the minimum wage, we alter workers’ incentives to migrate between local labor markets. This change could yield positive outcomes for two reasons: a potential reduction in the unemployment rate due to increased migration and the reallocation of workers towards higher-productivity labor markets. The model is estimated using matched employer-employee data from Spain, the Muestra Continua de Vidas Laborales (MCVL). I employ the estimated model to determine the optimal minimum wage level and describe its effects on welfare, unemployment, and migration rates.

The Joint Role of Housing and Labor Market Frictions

Abstract:

This paper investigates how frictions in the housing market interact with labor market outcomes in France. Using the Fidéli dataset, which links individual housing tenure to labor market transitions, I document large differences in mobility between renters and homeowners. Renters respond to unemployment shocks by adjusting housing consumption and migrating more frequently across municipalities and regions, while owners exhibit significantly lower mobility. By merging individual data with local measures of housing costs, wages, and unemployment, I show that expensive housing markets amplify these lock-in effects, limiting geographic mobility, and shaping reemployment opportunities. These results highlight housing tenure as a key determinant of spatial adjustment of the labor market and provide new evidence on the joint role of housing and labor market frictions