Racial Enclaves and Density Zoning: The Comparative Segregation of Racial Minorities in the United States

Abstract:     
This paper attempts to explain two basic facts of segregation in the United States in recent decades. The segregation of blacks remains everywhere higher than the segregation of immigrants, but the levels are converging. Anti-density zoning is the explanation advanced here. It has two proposed effects on segregation. First, it increases inter-jurisdictional inequality and economic segregation in MSAs, and second, it curtails the exit of minority groups from segregated communities by limiting the supply of affordable housing in integrated areas. Using two data sets of land regulations for the largest metropolitan areas, the results indicate that anti-density regulations are largely responsible for the levels and changes in segregation from 1990 to 2000. The results are robust to controlling for metropolitan area fixed effects in a reduced sample. The use of an exogenous source of zoning -year of statehood- as an instrument makes the effect roughly equal to that of income disparity. A hypothetical switch in zoning regimes from the most exclusionary to the most liberal would reduce the gap between the most and least segregated MSAs by at least 25% for the OLS estimates and at least 50% with the 2SLS estimates. In addition to zoning, government fragmentation, suburbanization, and relative income differences are strong predictors of segregation. Private anti-minority discrimination on the part of whites is found to be associated with modestly higher segregation, but real estate market discrimination is not.

Keywords: immigration, segregation, zoning, land regulation, local governance, fragmentation, Tiebout

JEL Classifications: J15, R1, R11, R14, R23, R5, R52, R58

Working Paper Series