The Impact of Racial Segregation on College Attainment in Spatial Equilibrium

Victoria Gregory, Julian Kozlowski and Hannah Rubinton

No 2022-036, Working Papers from Federal Reserve Bank of St. Louis

Abstract: This paper seeks to understand the forces that maintain racial segregation and the Black-White gap in college attainment, as well as their interactions with place-based policy interventions. We incorporate race into an overlapping-generations spatial-equilibrium model with parental investment and neighborhood spillovers. Race matters due to: (i) a Black-White wage gap, (ii) amenity externalities—households care about their neighborhood’s racial composition—and (iii) additional barriers to moving for Black households. We find that these forces account for 71% of the racial segregation and 64% of the Black-White gap in college attainment for the St. Louis metro area. The presence of spillovers and externalities generates multiple equilibria. Although St. Louis is in a segregated equilibrium, there also exists an integrated equilibrium with a lower college gap. We compare various place-based policy interventions to evaluate their effectiveness in reducing segregation and destabilizing the segregated equilibrium.

Keywords: racial disparities; neighborhood segregation; education; income inequality (search for similar items in EconPapers)
JEL-codes: J15 J24 O18 (search for similar items in EconPapers)
Pages: 59 pages
Date: 2022-10-12, Revised 2024-11-27
New Economics Papers: this item is included in nep-dge, nep-lma and nep-ure
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Related works:
Working Paper: The Impact of Racial Segregation on College Attainment in Spatial Equilibrium (2023)
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DOI: 10.20955/wp.2022.036

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