Review of the spatial mismatch hypothesis : its impact on the current plight of the central city in the United States

To begin, a 1968 paper by Kain argues that blacks, trapped in the central city due to racial discrimination in the housing market, do not have access to the jobs being created in the suburbs. It found that the residential segregation of blacks did contribute strongly to their unemployment. However, research on the hypothesis is beset by numerous data and conceptual problems. Some researchers have challenged the report"s findings, citing racial discrimination in hiring and macroeconomic factors as far more important than spatial mismatch for limiting the job opportunities of blacks, while others have found evidence supporting the spatial mismatch hypothesis. This paper also reviews the recent evidence that is based on micro-data and on modern econometric techniques, and identifies some gaps in the literature and discusses a more complete research agenda on this topic. (Author abstract)