Aspirations, Segregation and Occupational Choice
This paper examines steady states of an overlapping generations economy with a given distribution of household locations over a one-dimensional interval. Parents decide whether or not to educate their children. The model therefore combines local social interaction with global market interaction. The paper studies steadystate configurations of skill acquisition, both with and without segregation, and studies the macroeconomic and welfare effects of segregation on aggregate economic outcomes. [WP no. 187].
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