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Inequality and segregation

Author

Listed:
  • Rajiv Sethi

    (rs328@columbia.edu)

  • Rohini Somanathan

    () (Indian Statistical Institute, New Delhi)

Abstract

Despite the decline in group inequality and the rapid expansion of the black middle class in the United States, major urban centers with significant black populations continue to exhibit extreme levels of racial separation. Using a theoretical framework in which individuals care both about the level of affluence and the racial composition of their communities, we show that no monotonic relationship exists between narrowing racial income disparities and segregation even when all households prefer somewhat integrated communities to segregated ones. Low racial inequality is consistent with extreme and even rising levels of segregation in cities where the minority population is large. Our results can help explain why racial segregration continues to characterize the urban landscape in the United States even though survey evidence suggests that all groups favor more integration than they did in the past.

Suggested Citation

  • Rajiv Sethi & Rohini Somanathan, 2004. "Inequality and segregation," Indian Statistical Institute, Planning Unit, New Delhi Discussion Papers 04-03, Indian Statistical Institute, New Delhi, India.
  • Handle: RePEc:ind:isipdp:04-03
    as

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    File URL: http://www.isid.ac.in/~pu/dispapers/dp04-03.pdf
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    References listed on IDEAS

    as
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    More about this item

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D2 - Microeconomics - - Production and Organizations
    • D3 - Microeconomics - - Distribution
    • D4 - Microeconomics - - Market Structure, Pricing, and Design

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