Économie et Statistique n° 433-434 Unequal Access to Higher Education - Employment and Wages of Immigrants' Children - Place of residence and Wage Discrimination - Does the CPI reflect Changes in th Cost of Living in France?
Place of Residence and Wage Discrimination: The Case of Young People Living in a “Sensitive Urban Area” (Zone Urbaine Sensible)
This article studies wage gaps between young persons living in “sensitive urban areas” (Zones Urbaines Sensibles: ZUSs) at the end of their schooling and young people who do not reside in ZUSs but who live in urban units containing ZUSs. Our study takes into account potential barriers to accessing certain types of jobs, particularly managerial jobs. Like Brown, Moon, and Zoloth (1980), we apply a breakdown of wage gaps that incorporates the possibility of differences in job access by type of neighbourhood of residence. We use data from the first round of the CEREQ Génération 98 survey, which covers school-leavers in 1998 interviewed in 2001. Young persons living in ZUSs at the end of their schooling earn 13% less than other young persons and take up lower-skilled jobs. The breakdown shows that more than two-thirds of the wage difference is due to differences in job access. Moreover, our total results underscore the influence of weak human- and social-capital endowments among young people from ZUSs-endowments that confine them to low-skilled positions and account for their lower earnings. By contrast, the wage gaps that might be explained by discrimination are smaller. These results should, however, be viewed in perspective. We focus on the wage gaps for first jobs according to young people's place of residence at the time when they leave school. The place of residence is partly endogenous, as it depends on the parents' choice of residence, which may, in turn, be related to their children's educational or occupational plans. Furthermore, the breakdown does not allow us to take account of a selection effect in job access, which may be due to unobserved individual characteristics.