Segregation and Homeownership in the Early Twentieth Century
نویسندگان
چکیده
Racial gaps in homeownership over the past century in the United States have profound implications for black-white gaps in wealth, health, education, and public goods. Closely related to these gaps are patterns of residential sorting on the basis of race. We use new county-level segregation estimates for the period of 1880 to 1940 combined with homeownership data from the federal census to document a general rise in residential segregation in both urban and rural counties occurring alongside rising homeownership rates. However, we find a negative relationship between segregation and homeownership rates in the cross section for both white and black households. To further explore this relationship, we follow Fetter (2013) and use eligibility for GI Bill benefits as an exogenous source of variation in the ability to obtain a mortgage. We find that living in a more segregated county substantially reduced the impact of GI Bill benefits on white homeownership rates, suggesting that segregated locations potentially hindered both white and black homeownership. JEL classifications: J15, N32, 018, R31
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