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Middle Class Flight from Post-Katrina New Orleans: A Theoretical Analysis of Inequality and Schooling

Listed author(s):
  • Stefano Barbieri

    ()

    (Department of Economics, Tulane University)

  • John H. Y. Edwards

    ()

    (Department of Economics, Tulane University)

This paper stylizes the most salient characteristics of New Orleans' people and the Katrina evacuation and constructs a formal, theoretical model of their decision to return. We use the model to examine the post-Katrina population composition of the city, the evolution in its income distribution and in the welfare of its citizens, and changes in the level of education privately and publicly provided. Our results are, overall, positive for the new New Orleans. While smaller, the new New Orleans is more skill-intensive and education levels improve; these changes are broadly consistent with observed effects of Katrina on New Orleans. Moreover, while the possibility remains that Katrina-like events cause "middle-class flight," inequality is reduced under standard distributional assumptions, such as log-concavity. Nonetheless, the fact that many among the unskilled are unable to return remains problematic from an ethical point of view. Our analysis of a disaster's long term impact on a city through its effects on demographic composition, income and human capital distribution, and fiscal structure elucidates major determinants of urban resilience after a natural disaster.

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File URL: http://econ.tulane.edu/RePEc/pdf/tul1519.pdf
File Function: First Version, September 2015
Download Restriction: no

Paper provided by Tulane University, Department of Economics in its series Working Papers with number 1519.

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Date of creation: Sep 2015
Handle: RePEc:tul:wpaper:1519
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Web page: http://econ.tulane.edu

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  1. Mark Bagnoli & Ted Bergstrom, 2005. "Log-concave probability and its applications," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 26(2), pages 445-469, 08.
  2. Marcus Berliant & John H. Y. Edwards, 2004. "Efficient Allocations in Club Economies," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 6(1), pages 43-63, 02.
  3. Jeffrey A. Groen & Anne E. Polivka, 2008. "The Effect of Hurricane Katrina on the Labor Market Outcomes of Evacuees," American Economic Review, American Economic Association, vol. 98(2), pages 43-48, May.
  4. Tatyana Deryugina & Laura Kawano & Steven Levitt, 2014. "The Economic Impact of Hurricane Katrina on its Victims: Evidence from Individual Tax Returns," NBER Working Papers 20713, National Bureau of Economic Research, Inc.
  5. Conley, John P. & Konishi, Hideo, 2002. "Migration-proof Tiebout equilibrium: existence and asymptotic efficiency," Journal of Public Economics, Elsevier, vol. 86(2), pages 243-262, November.
  6. Albala-Bertrand, J. M., 1993. "Natural disaster situations and growth: A macroeconomic model for sudden disaster impacts," World Development, Elsevier, vol. 21(9), pages 1417-1434, September.
  7. Peter Bearse & Gerhard Glomm & Debra Moore Patterson, 2005. "Endogenous Public Expenditures on Education," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 7(4), pages 561-577, October.
  8. Dakshina G. De Silva & Robert P. McComb & Young-Kyu Moh & Anita R. Schiller & Andres J. Vargas, 2010. "The Effect of Migration on Wages: Evidence from a Natural Experiment," American Economic Review, American Economic Association, vol. 100(2), pages 321-326, May.
  9. Jeffrey Groen & Anne Polivka, 2010. "Going home after Hurricane Katrina: Determinants of return migration and changes in affected areas," Demography, Springer;Population Association of America (PAA), vol. 47(4), pages 821-844, November.
  10. Jeffrey A. Groen & Anne E. Polivka, 2008. "The Effect of Hurricane Katrina on the Labor Market Outcomes of Evacuees," Working Papers 415, U.S. Bureau of Labor Statistics.
  11. Anbarci, Nejat & Escaleras, Monica & Register, Charles A., 2005. "Earthquake fatalities: the interaction of nature and political economy," Journal of Public Economics, Elsevier, vol. 89(9-10), pages 1907-1933, September.
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