This dissertation analyses how the geographical sorting of individuals and households affects labour markets as well as gender and spatial inequality. In the ﬁrst chapter, I show that labour force participation increases with city size for all demographic groups except for women with children, for whom it decreases, a phenomenon that I label Big City Child Penalty (BCCP). Both by means of empirical evidence and a quantitative spatial model of households, I show that the BCCP can be explained by commuting times, wages, and childcare price differentials between small and big cities as well as for unobserved heterogeneity in preferences for a stay-home parent. The second chapter of this dissertation highlights the role of delayed childbearing as an important driver of gentrification. While downtowns provide shorter commuting times and more consumption amenities, limited housing space and schools’ worse quality reduce the value of this location choice when children are born. We exploit exogenous variation in the cost of postponing childbearing to obtain causal estimates of the impact of delayed maternity on gentrification. We find that enhanced access to assisted reproductive technologies in the state increases income downtown by 5.4% relative to the suburbs. The third chapter studies the relationship between trade and migration. Coinciding with a period of increasing trade integration, the educational composition of migrants within the European Union changed towards high-skilled workers. We build a two-country, two-sector general equilibrium model in which countries only differ in the productivity of high-tech workers. While price equalization, induced by trade integration, equalizes the real wages of non-educated workers, differences in the real wages of educated workers remain, since the latter are more productive in the most advanced country. As a consequence, factor mobility is needed to exhaust differences in real wages, leading to high-skilled emigration towards the most advanced country.