How Does Racial Residential Segregation Impact Economic and Social Outcomes in the United States?

The research examines how racial residential segregation influences economic and social disparities in the United States. Using a comprehensive review of literature and historical census data, the study analyzes segregation patterns, measurement methods, and long-term trends. Findings reveal that segregation has declined since the mid-20th century but remains persistent, particularly for Black Americans. The study highlights the role of structural barriers, infrastructure, and racial preferences in maintaining segregation. Size effects indicate that segregation is more pronounced at finer geographic scales, with Black-White dissimilarity indices ranging from 0.24 (state level) to 0.67 (block level), significantly shaping socioeconomic disparities.

Full Citation and Link to Article

Logan, Trevon D. and John M. Parman. "Racial Residential Segregation in the United States". JOURNAL OF ECONOMIC LITERATURE (FORTHCOMING). https://www.aeaweb.org/articles?id=10.1257/jel.20241373&within%5Btitle%5D=on&within%5Babstract%5D=on&within%5Bauthor%5D=on&journal=2&from=a&q=&page=53&per-page=21&from=j

Extended Summary

Central Research Question

The primary research question explored in this article is how racial residential segregation impacts economic and social disparities in the United States. The authors examine the mechanisms driving segregation, how it has evolved over time, and its socioeconomic consequences. They also assess different ways of measuring segregation and consider the extent to which structural and policy-driven factors influence persistent patterns of racial separation in residential spaces. By addressing these issues, the article aims to contribute to a broader understanding of how segregation perpetuates inequality and what new approaches might be useful in studying its long-term effects.

Previous Literature

The study builds upon an extensive body of research on racial residential segregation across multiple social science disciplines, including economics, sociology, and demography. The literature on segregation has evolved significantly over the years, starting with early works that documented basic patterns of segregation and their historical roots. Sociologists such as Massey and Denton (1993) provided key frameworks for understanding segregation, categorizing its various dimensions, and exploring how it affects access to economic opportunities, education, and social mobility.

In economics, research has focused on the role of market forces, housing policies, and individual preferences in shaping segregation. Cutler, Glaeser, and Vigdor (1999) documented the rise and decline of segregation in U.S. cities, showing that it peaked in the mid-20th century and gradually decreased due to changing social attitudes, legal interventions, and economic shifts. More recent studies have emphasized the role of structural barriers, such as infrastructure design, redlining, and exclusionary zoning, in maintaining segregation despite these broader declines.

The literature also explores the consequences of segregation, particularly in education, employment, and wealth accumulation. Studies have consistently shown that segregation limits access to high-quality schools, well-paying jobs, and healthcare, leading to entrenched racial disparities. While some researchers argue that economic mobility has improved for some minority groups, the persistence of segregation suggests that the benefits of integration remain unevenly distributed.

Data

The article draws upon a combination of historical census data, geographic segregation measures, and previous empirical studies. The primary data sources include:

U.S. Census Data – Used to examine segregation patterns at multiple geographic scales (state, county, census tract, and block levels) over time. The study highlights how different measures of segregation produce different insights depending on the geographic unit of analysis.
Historical Segregation Measures – The authors utilize indices such as the dissimilarity index, exposure measures, and entropy indices to assess the extent of racial separation. These measures help in understanding how segregation varies across different regions and time periods.
GIS and Infrastructure Data – The study incorporates geographic information systems (GIS) to analyze how infrastructure, such as railroads and highways, has influenced racial segregation patterns by creating physical barriers between racial groups.
Existing Empirical Studies – The article synthesizes findings from previous research to provide a comprehensive overview of segregation’s causes and consequences, integrating insights from sociology, economics, and urban studies.

Methods

The authors employ both qualitative and quantitative methods to analyze segregation trends and their impacts. Their approach includes:

Descriptive Analysis of Segregation Trends – The study provides an overview of historical and contemporary segregation patterns using dissimilarity indices, exposure indices, and entropy measures. These measures allow for a comparative analysis of segregation at different geographic scales, from national trends to localized patterns within cities and neighborhoods.
Comparative Geographic Analysis – By examining segregation at different levels (state, county, census tract, and census block), the authors demonstrate how segregation is more pronounced at finer geographic scales. This analysis reveals how broader regional trends may obscure more localized patterns of racial separation.
Causal Inference Using Infrastructure as an Instrument – The study references previous research that uses railroad infrastructure as an instrument to estimate the causal impact of segregation on economic outcomes. This method helps to isolate the effects of segregation from other confounding factors that may influence economic disparities.
Review of Policy Interventions – The authors analyze how various policy measures, such as the Fair Housing Act and zoning laws, have influenced segregation trends. They highlight the limitations of these policies in addressing structural segregation and suggest areas for future research.

Findings and Size Effects

The study’s findings indicate that while racial residential segregation has declined since the mid-20th century, it remains a significant factor in shaping economic and social outcomes. Several key findings emerge:

Persistent Segregation at Finer Geographic Scales – National and state-level measures of segregation suggest moderate declines in racial separation, but county- and neighborhood-level data reveal continued high levels of segregation. For example, the Black-White dissimilarity index is 0.24 at the state level but rises to 0.67 at the block level, indicating that while broad regional integration may be occurring, localized segregation remains entrenched.
Infrastructure as a Structural Barrier – Geographic barriers such as railroads, highways, and rivers have historically reinforced segregation patterns. Cities with more bisecting railroad lines tend to have higher levels of segregation, as these physical barriers have limited residential mobility and reinforced racial boundaries.
Economic Disparities Rooted in Segregation – Segregation is strongly correlated with disparities in education, employment, and wealth accumulation. Black and Hispanic families earning over $75,000 per year still live in poorer neighborhoods on average than White families earning less than $40,000 per year. This finding underscores how segregation limits economic opportunities even for middle- and upper-income minority households.
Impact of Policy Interventions – The study finds that legal and policy interventions, such as the Fair Housing Act, have led to some reductions in segregation, but their effects have been uneven. Exclusionary zoning, discriminatory lending practices, and school district boundaries continue to perpetuate segregation despite legal prohibitions against racial discrimination.
The Role of White Preferences – Surveys and experimental studies indicate that White households continue to prefer predominantly White neighborhoods, contributing to ongoing patterns of segregation. This preference for racial homogeneity plays a key role in sustaining segregation even in the absence of explicit legal barriers.

Conclusion

The study concludes that racial residential segregation remains a powerful force shaping economic and social inequality in the United States. While some progress has been made in reducing segregation at broad geographic levels, localized patterns of racial separation persist, reinforcing disparities in wealth, education, and health. The authors emphasize that understanding segregation requires a multidimensional approach that considers historical, economic, and policy-driven factors.

Future research should explore alternative measures of segregation that account for new patterns of urban and suburban migration, as well as the impact of emerging policy interventions. Additionally, greater attention should be given to the role of racial preferences and structural barriers in maintaining segregation. The study highlights the importance of continued policy efforts to address exclusionary practices and promote more equitable access to housing and economic opportunities.

Overall, the research provides a comprehensive examination of segregation’s causes, measurement challenges, and consequences, offering valuable insights for policymakers, researchers, and urban planners seeking to address racial disparities in the United States.