The Cost of Segregation in Social Networks

Nizar Allouch

No 703, Working Papers from Queen Mary University of London, School of Economics and Finance

Abstract: This paper investigates the private provision of public goods in segregated societies. While most research agrees that segregation undermines public provision, the findings are mixed for private provision: social interactions, being strong within groups and limited across groups, may either increase or impede voluntary contributions. Moreover, although efficiency concerns generally provide a rationale for government intervention, surprisingly, little light is shed in the literature on the potential effectiveness of such intervention in a segregated society. This paper first develops an index based on social interactions, which, roughly speaking, measures the welfare impact of income redistribution in an arbitrary society. It then shows that the proposed index vanishes when applied to large segregated societies, which suggests an "asymptotic neutrality" of redistributive policies.

Keywords: Public goods; Segregated society; Private provision; Networks; Bonacich transfer index (search for similar items in EconPapers)
JEL-codes: C72 D31 H41 (search for similar items in EconPapers)
Date: 2013-05-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: The cost of segregation in (social) networks (2017)
Working Paper: The Cost of Segregation in Social Networks (2013)
Working Paper: The Cost of Segregation in Social Networks (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:qmw:qmwecw:703

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