Analysis of Neighbourhood Effects and Work Behaviour: Evidence from Paris.

This paper highlights the effects of being located in a deprived neighbourhood on unemployment. Interest is focused on the consequences of neighbourhood effects. The paper uses the 1999 Population Census for Paris and the three surrounding sub-regional administrative districts in order to estimate different models that take into account the potential endogeneity bias of the residential location choice. The study first runs a bivariate probit model that includes the residential location as an endogenous variable. A probit model is also run on a sub-sample of households living in public housing with the idea that for them the location choice is exogenous. Whatever the method used, it is shown that living within the most deprived neighbourhoods, in terms of local composition, decreases the probability of employment. [ABSTRACT FROM AUTHOR]