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Neighborhood income distributions

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  • Ioannides, Yannis M.

Abstract

This paper studies purely empirically aspects of the distribution of income within small neighborhoods and contrasts it with the income distribution at higher level of aggregation, such as census tracts and metropolitan areas. It relies on a unique feature of the American Housing Survey, whose 1985, 1989 and 1993 waves provide data for small residential neighborhoods. These consist of a dwelling unit and up to ten of its nearest neighbors. The paper employs several parametric and nonparametric econometric tools to measure income sorting in US residential neighborhoods. It documents the patterns of dependence among neighbors’ income and imperfect sorting, with moderate but very significant correlation among incomes of neighbors and of considerable income mixing in U.S. neighborhoods. These results persist even if choice-based sampling and heterogeneity across the sample are accounted for. Neighborhoods associated with a randomly selected renter are more sorted than those associated with an owner even though such owners are more likely to define their neighborhoods.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Urban Economics.

Volume (Year): 56 (2004)
Issue (Month): 3 (November)
Pages: 435-457

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Handle: RePEc:eee:juecon:v:56:y:2004:i:3:p:435-457

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Web page: http://www.elsevier.com/locate/inca/622905

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  1. Kremer, Michael, 1997. "How Much Does Sorting Increase Inequality?," The Quarterly Journal of Economics, MIT Press, vol. 112(1), pages 115-39, February.
  2. Danny Quah, 1996. "Twin peaks : growth and convergence in models of distribution dynamics," LSE Research Online Documents on Economics 2278, London School of Economics and Political Science, LSE Library.
  3. Quah, Danny, 1996. "Twin Peaks: Growth and Convergence in Models of Distribution Dynamics," CEPR Discussion Papers 1355, C.E.P.R. Discussion Papers.
  4. Christopher J. Mayer, 1996. "Does location matter?," New England Economic Review, Federal Reserve Bank of Boston, issue May, pages 26-40.
  5. Yannis M. Ioannides, 1999. "Residential Neighborhood Effects," Discussion Papers Series, Department of Economics, Tufts University 9912, Department of Economics, Tufts University.
  6. Dennis Epple & Holger Sieg, 1999. "Estimating Equilibrium Models of Local Jurisdictions," Journal of Political Economy, University of Chicago Press, vol. 107(4), pages 645-681, August.
  7. Michael Kremer & Eric Maskin, 1996. "Wage Inequality and Segregation," Harvard Institute of Economic Research Working Papers 1777, Harvard - Institute of Economic Research.
  8. Karen Eggleston, 2001. "Multitasking, Competition and Provider Payment," Discussion Papers Series, Department of Economics, Tufts University 0101, Department of Economics, Tufts University.
  9. Ioannides, Yannis M., 2003. "Interactive property valuations," Journal of Urban Economics, Elsevier, vol. 53(1), pages 145-170, January.
  10. Ellickson, Bryan, 1971. "Jurisdictional Fragmentation and Residential Choice," American Economic Review, American Economic Association, vol. 61(2), pages 334-39, May.
  11. Kremer, M & Maskin, E, 1996. "Wage Inequality and Segregation by Skill," Working papers 96-23, Massachusetts Institute of Technology (MIT), Department of Economics.
  12. Yannis Ioannides, 2006. "Empirics of Social Interactions," Discussion Papers Series, Department of Economics, Tufts University 0611, Department of Economics, Tufts University.
  13. Danny Quah, 1996. "Twin Peaks: Growth and Convergence in Models of Distribution Dynamics," CEP Discussion Papers dp0280, Centre for Economic Performance, LSE.
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