Abstract
The aim of this article is to assess the impact of high housing costs on labor market differentials between high-skilled and low-skilled workers, with a goal of shedding light on the issue of affordable housing deficit. We conduct an inter-city analysis, comparing differences in outcomes between high- and low-skilled workers based on intra-city mechanisms, in line with urban labor models (Zenou, 2009). We use French administrative data to follow the labor market trajectories of workers over the period 2010-2018, as well as precise data on housing costs. We focus for now on two outcomes: the stability of the contract and the probability of promotion. At the empirical level, we employ instrumental variable techniques to deal with the endogeneity between the housing and labor markets, and a ''two-stage approach'' to control for the non-random spatial sorting of individuals across cities.