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The London Bombings and Racial Prejudice: Evidence from Housing and Labour Markets

  • Anita Ratcliffe

    ()

    (Department of Economics, The University of Sheffield)

  • Stephanie von Hinke Kessler Scholder

    ()

    (University of York)

This paper investigates the impact of the London bombings on attitudes towards ethnic minorities, examining outcomes in housing and labour markets across London boroughs. We use a difference-in-differences approach, specifying `treated' boroughs as those with the highest concentration of Asian residents. Our results indicate that house prices in treated boroughs fell by approximately 2.3% in the two years after the bombings relative to other boroughs, with sales declining by approximately 5.7%. Furthermore, we present evidence of a rise in the unemployment rate in treated compared to control boroughs, as well as a rise in racial segregation. These results are robust to several `falsification' checks with respect to the definition and timing of treatment.

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File URL: http://www.shef.ac.uk/economics/research/serps/articles/2013_013.html
File Function: First version, 2013
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Paper provided by The University of Sheffield, Department of Economics in its series Working Papers with number 2013013.

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Length: 26 pages
Date of creation: 2013
Date of revision:
Handle: RePEc:shf:wpaper:2013013
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  1. Kevin Lang & Jee-Yeon K. Lehmann, 2011. "Racial Discrimination In The Labor Market: Theory And Empirics," Boston University - Department of Economics - Working Papers Series WP2011-019, Boston University - Department of Economics.
  2. Mirko Draca & Steve Machin & Robert Witt, 2008. "Panic on the streets of London: police, crime and the July 2005 terror attacks," LSE Research Online Documents on Economics 19632, London School of Economics and Political Science, LSE Library.
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  9. Nils Braakmann, 2009. "The Impact of September 11th, 2001 on the Employment Prospects of Arabs and Muslims in the German Labor Market," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 229(1), pages 2-21, February.
  10. Shannon, Michael, 2012. "Did the September 11th attacks affect the Canadian labour market?," Economics Letters, Elsevier, vol. 115(1), pages 91-93.
  11. Nils Braakmann, 2010. "Islamistic Terror And The Labour Market Prospects Of Arab Men In England: Does A Country'S Direct Involvement Matter?," Scottish Journal of Political Economy, Scottish Economic Society, vol. 57(4), pages 430-454, 09.
  12. Olof ├ůslund & Dan-Olof Rooth, 2005. "Shifts in attitudes and labor market discrimination: Swedish experiences after 9-11," Journal of Population Economics, Springer;European Society for Population Economics, vol. 18(4), pages 603-629, November.
  13. Neeraj Kaushal & Robert Kaestner & Cordelia Reimers, 2007. "Labor Market Effects of September 11th on Arab and Muslim Residents of the United States," Journal of Human Resources, University of Wisconsin Press, vol. 42(2).
  14. Gautier, Pieter A. & Siegmann, Arjen & Van Vuuren, Aico, 2009. "Terrorism and attitudes towards minorities: The effect of the Theo van Gogh murder on house prices in Amsterdam," Journal of Urban Economics, Elsevier, vol. 65(2), pages 113-126, March.
  15. Rabby, Faisal & Rodgers III, William M., 2010. "The Impact of 9/11 and the London Bombings on the Employment and Earnings of U.K. Muslims," IZA Discussion Papers 4763, Institute for the Study of Labor (IZA).
  16. Deepti Goel, 2010. "Perceptions of Immigrants in Australia after 9/11," The Economic Record, The Economic Society of Australia, vol. 86(275), pages 596-608, December.
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