Neighborhood dynamics and the distribution of opportunity

• 成果类型: Article
• 署名作者: Aliprantis, Dionissi; Carroll, Daniel R.
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Cleveland
• 刊物名称: QUANTITATIVE ECONOMICS
• ISSN/ISSBN: 1759-7323
• DOI: 10.3982/QE785
• 发表日期: 2018
• 页码: 247-303
• 关键词: Neighborhood effect; residential sorting; DYNAMICS; human capital; segregation

摘要

This paper studies neighborhood effects using a dynamic general equilibrium model. Households choose where to live and how much to invest in their child's human capital. The return on parents' investment is determined in part by their child's ability and in part by a neighborhood externality. We calibrate the model using data from Chicago in 1960, assuming that in previous decades households were randomly allocated to, and then could not move from, neighborhoods with different total factor productivity (TFP). This restriction on neighborhood choice allows us to overcome the fundamental problem of endogenous neighborhood selection. We use the calibrated model to study Wilson's (1987) hypothesis that racial equality under the law need not ensure equality of opportunity due to neighborhood dynamics. We examine the consequences of allowing for mobility, equalizing TFP, or both. In line with Wilson, 1987, sorting can lead to persistent inequality of opportunity across locations if initial conditions are unequal. Our results highlight the importance of forward-looking agents.