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Diversity and Public Goods: A Natural Experiment with Exogenous Residential Allocation

  • Algan, Yann

    ()

    (Sciences Po, Paris)

  • Hémet, Camille

    ()

    (Sciences Po, Paris)

  • Laitin, David D.

    ()

    (Stanford University)

This paper demonstrates the effects of ethnic and religious diversity on the quality of public spaces. Its identification strategy relies on the exogeneity of public housing allocations in France, and thereby eliminates the bias from endogenous sorting. The paper uses micro evidence of social interactions within housing blocks from the representative French Housing survey, which allows for a detailed identification of the channels through which diversity operates. Differentiating among three channels of public goods provision, the paper finds that heterogeneity in the housing block leads to low levels of sanctions for anti-social behavior and low levels of collective action to improve housing conditions, but no losses in public safety.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6053.

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Length: 42 pages
Date of creation: Oct 2011
Handle: RePEc:iza:izadps:dp6053
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