Heterogeneous Immigration, Segregation and Trade
By introducing taste heterogeneity between mobile workers in a New Economic Geography (NEG) model where the housing price is the main driving force behind dispersion of workers we show that residential segregation and agglomeration are not the sole stable equilibria and that dispersion also emerges with trade liberalization. In addition we find that contrary to the Tiebout hypothesis where segregation is efficient, here it is the dispersed and mixed equilibrium which can be improving for all.
Volume (Year): 1 (2011)
Issue (Month): (February)
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References listed on IDEAS
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- Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416-416.
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- Zeng, Dao-Zhi, 2008. "New economic geography with heterogeneous preferences: An explanation of segregation," Journal of Urban Economics, Elsevier, vol. 63(1), pages 306-324, January.
- Glazer, Amihai & Gradstein, Mark & Ranjan, Priya, 2003. "Consumption variety and urban agglomeration," Regional Science and Urban Economics, Elsevier, vol. 33(6), pages 653-661, October.
- Dixit, Avinash K., 1990. "Optimization in Economic Theory," OUP Catalogue, Oxford University Press, edition 2, number 9780198772101, April.
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