IDEAS home Printed from https://ideas.repec.org/a/bla/revinw/v55y2009i3p820-844.html
   My bibliography  Save this article

Inequality And The Measurement Of Residential Segregation By Income In American Neighborhoods

Author

Listed:
  • Tara Watson

Abstract

American metropolitan areas have experienced rising residential segregation by income since 1970. One potential explanation for this change is growing income inequality. However, measures of residential sorting are typically mechanically related to the income distribution, making it difficult to identify the impact of inequality on residential choice. This paper presents a measure of residential segregation by income, the Centile Gap Index (CGI), which is based on income percentiles. Using the CGI, I find that a one standard deviation increase in income inequality raises residential income segregation by 0.4–0.9 standard deviations. Inequality at the top of the distribution is associated with more segregation of the rich, while inequality at the bottom and declines in labor demand for less‐skilled men are associated with residential isolation of the poor. Inequality can fully explain the rise in income segregation between 1970 and 2000.

Suggested Citation

  • Tara Watson, 2009. "Inequality And The Measurement Of Residential Segregation By Income In American Neighborhoods," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 55(3), pages 820-844, September.
    • Handle: RePEc:bla:revinw:v:55:y:2009:i:3:p:820-844
    DOI: 10.1111/j.1475-4991.2009.00346.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1475-4991.2009.00346.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1475-4991.2009.00346.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64(5), pages 416-416.
    2. Jeffrey R. Kling & Jeffrey B. Liebman, 2004. "Experimental Analysis of Neighborhood Effects on Youth," Working Papers 1, Princeton University, Department of Economics, Industrial Relations Section..
    3. David M. Cutler & Edward L. Glaeser & Jacob L. Vigdor, 1999. "The Rise and Decline of the American Ghetto," Journal of Political Economy, University of Chicago Press, vol. 107(3), pages 455-506, June.
    4. P. A. Jargowsky, "undated". "Take the money and run: Economic segregation in U.S. metropolitan areas," Institute for Research on Poverty Discussion Papers 1056-95, University of Wisconsin Institute for Research on Poverty.
    5. Epple, Dennis & Platt, Glenn J., 1998. "Equilibrium and Local Redistribution in an Urban Economy when Households Differ in both Preferences and Incomes," Journal of Urban Economics, Elsevier, vol. 43(1), pages 23-51, January.
    6. Caroline Hoxby, 2000. "Peer Effects in the Classroom: Learning from Gender and Race Variation," NBER Working Papers 7867, National Bureau of Economic Research, Inc.
    7. Edward L. Glaeser, 2007. "The Economics Approach to Cities," NBER Working Papers 13696, National Bureau of Economic Research, Inc.
    8. Susan E. Mayer, 2001. "How the Growth in Income Inequality Increased Economic Segregation," Working Papers 0117, Harris School of Public Policy Studies, University of Chicago.
    9. Davidoff, Thomas, 2005. "Income sorting: Measurement and decomposition," Journal of Urban Economics, Elsevier, vol. 58(2), pages 289-303, September.
    10. repec:pri:cheawb:j_kling_2005.pdf is not listed on IDEAS
    11. Douglas Massey, 1996. "The age of extremes: Concentrated affluence and poverty in the twenty-first century," Demography, Springer;Population Association of America (PAA), vol. 33(4), pages 395-412, November.
    12. David M. Cutler & Edward L. Glaeser, 1997. "Are Ghettos Good or Bad?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(3), pages 827-872.
    13. repec:pri:cheawb:j_kling_2005 is not listed on IDEAS
    14. Ioannides, Yannis M., 2004. "Neighborhood income distributions," Journal of Urban Economics, Elsevier, vol. 56(3), pages 435-457, November.
    15. Jeffrey R Kling & Jeffrey B Liebman & Lawrence F Katz, 2007. "Experimental Analysis of Neighborhood Effects," Econometrica, Econometric Society, vol. 75(1), pages 83-119, January.
    16. Anne C. Case & Lawrence F. Katz, 1991. "The Company You Keep: The Effects of Family and Neighborhood on Disadvantaged Youths," NBER Working Papers 3705, National Bureau of Economic Research, Inc.
    17. Stephen Machin, 2008. "An Appraisal of Economic Research on Changes in Wage Inequality," LABOUR, CEIS, vol. 22(s1), pages 7-26, June.
    18. Claude Fischer & Gretchen Stockmayer & Jon Stiles & Michael Hout, 2004. "Distinguishing the geographic levels and social dimensions of U.S. metropolitan segregation, 1960–2000," Demography, Springer;Population Association of America (PAA), vol. 41(1), pages 37-59, February.
    19. Glaeser, Edward L. & Kahn, Matthew E. & Rappaport, Jordan, 2008. "Why do the poor live in cities The role of public transportation," Journal of Urban Economics, Elsevier, vol. 63(1), pages 1-24, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bryan S. Graham, 2018. "Identifying and Estimating Neighborhood Effects," Journal of Economic Literature, American Economic Association, vol. 56(2), pages 450-500, June.
    2. Jacob Vigdor & Jens Ludwig, 2007. "Segregation and the Black-White Test Score Gap," NBER Working Papers 12988, National Bureau of Economic Research, Inc.
    3. Card, David & Rothstein, Jesse, 2007. "Racial segregation and the black-white test score gap," Journal of Public Economics, Elsevier, vol. 91(11-12), pages 2158-2184, December.
    4. Patrick Bayer & Stephen L. Ross, 2006. "Identifying Individual and Group Effects in the Presence of Sorting: A Neighborhood Effects Application," Working papers 2006-13, University of Connecticut, Department of Economics, revised Jan 2009.
    5. Kuzey Yılmaz & Muharrem Yeşilırmak, 2023. "Access to transportation, residential segregation, and economic opportunity," Contemporary Economic Policy, Western Economic Association International, vol. 41(1), pages 103-127, January.
    6. Jens Ludwig & Jeffrey R. Kling, 2007. "Is Crime Contagious?," Journal of Law and Economics, University of Chicago Press, vol. 50(3), pages 491-518.
    7. Cutler, David M. & Glaeser, Edward L. & Vigdor, Jacob L., 2008. "When are ghettos bad? Lessons from immigrant segregation in the United States," Journal of Urban Economics, Elsevier, vol. 63(3), pages 759-774, May.
    8. Federico Echenique & Roland G. Fryer Jr., 2005. "On the Measurement of Segregation," Labor and Demography 0503006, University Library of Munich, Germany.
    9. Elizabeth A. La Jeunesse & Christopher H. Wheeler, 2007. "Neighborhood income inequality," Working Papers 2006-039, Federal Reserve Bank of St. Louis.
    10. Ortalo-Magné, François & Rady, Sven, 2008. "Heterogeneity within communities: A stochastic model with tenure choice," Journal of Urban Economics, Elsevier, vol. 64(1), pages 1-17, July.
    11. Hellerstein, Judith K. & Neumark, David & McInerney, Melissa, 2008. "Spatial mismatch or racial mismatch?," Journal of Urban Economics, Elsevier, vol. 64(2), pages 464-479, September.
    12. Eric A. Hanushek & John F. Kain & Steven G. Rivkin, 2009. "New Evidence about Brown v. Board of Education: The Complex Effects of School Racial Composition on Achievement," Journal of Labor Economics, University of Chicago Press, vol. 27(3), pages 349-383, July.
    13. Hanushek Eric A & Sarpça Sinan & Yilmaz Kuzey, 2011. "Private Schools and Residential Choices: Accessibility, Mobility, and Welfare," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 11(1), pages 1-34, August.
    14. Paul Cheshire, 2009. "Policies for Mixed Communities," International Regional Science Review, , vol. 32(3), pages 343-375, July.
    15. Alberto Alesina & Reza Baqir & Caroline Hoxby, 2004. "Political Jurisdictions in Heterogeneous Communities," Journal of Political Economy, University of Chicago Press, vol. 112(2), pages 348-396, April.
    16. Rhiannon Patterson, 2008. "Neighborhood Effects on High-School Drop-Out Rates and Teenage Childbearing: Tests for Non-Linearities, Race-Specific Effects, Interactions with Family Characteristics, and Endogenous Causation using ," Working Papers 08-12, Center for Economic Studies, U.S. Census Bureau.
    17. repec:pri:indrel:dsp010p096690c is not listed on IDEAS
    18. Rodrigo Diaz & Nicolas Garrido & Miguel Vargas, 2021. "Segregation of high‐skilled workers and the productivity of cities," Regional Science Policy & Practice, Wiley Blackwell, vol. 13(5), pages 1460-1478, October.
    19. Alberto Alesina & Ekaterina Zhuravskaya, 2011. "Segregation and the Quality of Government in a Cross Section of Countries," American Economic Review, American Economic Association, vol. 101(5), pages 1872-1911, August.
    20. Francesco Agostinelli & Matthias Doepke & Giuseppe Sorrenti & Fabrizio Zilibotti, 2020. "It Takes a Village: The Economics of Parenting with Neighborhood and Peer Effects," Cowles Foundation Discussion Papers 2228, Cowles Foundation for Research in Economics, Yale University.
    21. Cheshire, Paul, 2009. "Policies for mixed communities: faith-based displacement activity?," LSE Research Online Documents on Economics 30783, London School of Economics and Political Science, LSE Library.

    More about this item

    JEL classification:

    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:revinw:v:55:y:2009:i:3:p:820-844. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/iariwea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.