Does public housing occupancy increase unemployment ? ∗

This paper shows that living in public housing has no effect on the probability of being unemployed in France, once we account for the endogeneity of public housing. We estimate a simultaneous probit model of unemployment and public housing. On a first sample for Lyon, we instrument public housing with the gender composition of children. On a second national sample, the instrument is the city-level share of public housing. Both samples yield the same ∗Claire Dujardin thanks the F.R.S.-FNRS for financing a research stay at GATE. Florence Goffette-Nagot acknowledges funding from the MiRe (Ministère de l Emploi, de la Cohésion sociale et du Logement and Ministère de la Santé et des Solidarités). Census data from the French National Institute for Statistics (Insee) was provided by the Centre Maurice Halbwachs. The authors gratefully thank the Division Logement (Insee) for the agreement Insee/Gate/Inra that allowed using data from the French Housing Survey. †Université catholique de Louvain, CORE, Voie du Roman Pays, 34, B-1348 Louvain-la-Neuve, Belgium. Email: [email protected]. ‡Université de Lyon, Lyon, F-69003, France; CNRS, GATE, UMR 5824, Ecully, F-69130, France. Email: [email protected]. Corresponding author. 1 ha ls hs -0 04 36 67 9, v er si on 1 27 N ov 2 00 9 Author manuscript, published in "Journal of Economic Geography 9 (2009) pp. 823-851" DOI : 10.1093/jeg/lbp002