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The Stability of Mixed Income Neighborhoods in America

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Author Info
Krupka, Douglas J. () (IZA)

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Abstract

Whether people of differing types can live happily together is one of the most important social and political questions concerning urban areas. From a variety of theoretical perspectives, such mixing seems extremely unlikely. While the theoretical result seems well supported in the context of race, the evidence for income mixing is much less stark. Compared to the strict segregation predicted by the models (and embodied in the context of race), Americans live in economically diverse neighborhoods. While this has lead to some further theoretical experiments, the stability of this mixing has never been addressed as an empirical matter. It would be naïve to look at cross-sectional snapshots of income mixing as representing stable situations, since neighborhood change is a prevalent feature of American urban economies. This paper sketches out the empirical implications of slow transition towards the predicted equilibrium, and tests those implications. It is the first paper to directly evaluate the persistence and stability of mixed-income communities. The results are supportive of the three models of income segregation: income mixing appears to be unstable, although the adjustment process is slow. This work is of especial importance due to the focus mixed-income communities receive in the urban planning and policy.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3370.

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Length: 61 pages
Date of creation: Feb 2008
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Handle: RePEc:iza:izadps:dp3370

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Related research
Keywords: mixed-income; urban policy; neighborhood dynamics; neighborhood change; sorting; segregation;

Find related papers by JEL classification:
R14 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Land Use Patterns
R2 - Urban, Rural, and Regional Economics - - Household Analysis
R11 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Analysis of Growth, Development, and Changes
R31 - Urban, Rural, and Regional Economics - - Production Analysis and Firm Location - - - Housing Supply and Markets
N9 - Economic History - - Regional and Urban History
O2 - Economic Development, Technological Change, and Growth - - Development Planning and Policy

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416. [Downloadable!] (restricted)
  2. Schelling, Thomas C, 1969. "Models of Segregation," American Economic Review, American Economic Association, vol. 59(2), pages 488-93, May. [Downloadable!] (restricted)
  3. Rosenthal, Stuart S., 2008. "Old homes, externalities, and poor neighborhoods. A model of urban decline and renewal," Journal of Urban Economics, Elsevier, vol. 63(3), pages 816-840, May. [Downloadable!] (restricted)
  4. Frankel, David M., 1998. "A Pecuniary Reason for Income Mixing," Journal of Urban Economics, Elsevier, vol. 44(1), pages 158-169, July. [Downloadable!] (restricted)
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  5. Miyao, Takahiro, 1978. "Dynamic Instability of a Mixed City in the Presence of Neighborhood Externalities," American Economic Review, American Economic Association, vol. 68(3), pages 454-63, June. [Downloadable!] (restricted)
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