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Urban Inequality

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  • Edward L. Glaeser
  • Matthew G. Resseger
  • Kristina Tobio

Abstract

What impact does inequality have on metropolitan areas? Crime rates are higher in places with more inequality, and people in unequal cities are more likely to say that they are unhappy. There is also a negative association between local inequality and the growth of both income and population, once we control for the initial distribution of skills. What determines the degree of inequality across metropolitan areas? Twenty years ago, metropolitan inequality was strongly associated with poverty, but today, inequality is more strongly linked to the presence of the wealthy. Inequality in skills can explain about one third of the variation in income inequality, and that skill inequality is itself explained by historical schooling patterns and immigration. There are also substantial differences in the returns to skill, related to local concentrations in different industries, and these too are strongly correlated with inequality.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 14419.

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Date of creation: Oct 2008
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Handle: RePEc:nbr:nberwo:14419

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Cited by:
  1. Papps, Kerry L. & Bryson, Alex & Gomez, Rafael, 2011. "Heterogeneous worker ability and team-based production: Evidence from major league baseball, 1920-2009," Labour Economics, Elsevier, Elsevier, vol. 18(3), pages 310-319, June.
  2. World Bank, 2012. "From Political to Economic Awakening : The Path of Economic Integration - Deauville Partnership Report on Trade and Foreign Direct Investment, Volume 2. Main Report," World Bank Other Operational Studies 11887, The World Bank.
  3. World Bank, 2012. "From Political to Economic Awakening in the Arab World : The Path of Economic Integration - Deauville Partnership Report on Trade and Foreign Direct Investment, Volume 1. Overview Report," World Bank Other Operational Studies 11886, The World Bank.
  4. Peter McHenry, 2010. "The Geographic Distribution of Human Capital: Measurement of Contributing Mechanisms," Working Papers, Department of Economics, College of William and Mary 92, Department of Economics, College of William and Mary.
  5. Shahid Yusuf & Kaoru Nabeshima, 2009. "Growth through Innovation : An Industrial Strategy for Shanghai," World Bank Other Operational Studies 18613, The World Bank.
  6. Cruces, Guillermo & Perez Truglia, Ricardo & Tetaz, Martin, 2011. "Biased Perceptions of Income Distribution and Preferences for Redistribution: Evidence from a Survey Experiment," IZA Discussion Papers 5699, Institute for the Study of Labor (IZA).
  7. Lööf, Hans & Nabavi, Pardis, 2012. "Increasing Return To Smart Cities," Working Paper Series in Economics and Institutions of Innovation, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies 274, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies, revised 26 Sep 2012.
  8. Mark Frank, 2009. "Income Inequality, Human Capital, and Income Growth: Evidence from a State-Level VAR Analysis," Atlantic Economic Journal, International Atlantic Economic Society, International Atlantic Economic Society, vol. 37(2), pages 173-185, June.

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