Ethnicity, Neighborhoods, and Human-Capital Externalities

George Borjas

American Economic Review, 1995, vol. 85, issue 3, 365-90

Abstract: The socioeconomic performance of today's workers depends not only on parental skills but also on the average skills of the ethnic group in the parents' generation (or ethnic capital). This paper investigates the link between the ethnic externality and ethnic neighborhoods. The evidence indicates that residential segregation and the external effect of ethnicity are linked, partly because ethnic capital summarizes the socioeconomic background of the neighborhood where the children were raised. Ethnicity has an external effect, even among persons who grow up in the same neighborhood, when children are exposed frequently to persons who share the same ethnic background. Copyright 1995 by American Economic Association.

Date: 1995
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Working Paper: Ethnicity, Neighborhoods, and Human Capital Externalities (1994)
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