There goes the neighborhood does tipping exist amongst income groups?

Thom Malone

Journal of Housing Economics, 2020, vol. 48, issue C

Abstract: The ‘tipping point’ model of segregation Schelling (1971) has rarely been tested for socioeconomic variables besides race. Using US Census data from 1970 to 2010, I find evidence for tipping behavior amongst income groups. This is strongest when the population is split at the 10th percentile of income. In this case, average tipping points range from 7 to 12%. When the proportion of people below the 10th percentile in a neighborhood exceeds said tipping point, the decrease in those above the 10th percentile will be from 5 to 14%. Robustness checks indicate that these effects are not misinterpreted racial tipping points, nor a result of peoples’ income percentile changing over their lifetime. Effects are strongest in neighborhoods with more school-aged children, suggesting that income tipping is driven by concerns that the provision of local public goods could drop from an influx of lower class residents.

JEL-codes: J10 O15 R10 R23 (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhouse:v:48:y:2020:i:c:s1051137718300135

DOI: 10.1016/j.jhe.2019.101667

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