Density Zoning and Class Segregation in U.S. Metropolitan Areas

Abstract:     
Objectives. Socioeconomic segregation rose substantially in U.S. cities during the final decades of the 20th century and we argue zoning regulations are an important cause for this increase. Methods. We measure neighborhood economic segregation using the Gini Coefficient for neighborhood income inequality and the poor-affluent exposure index. These outcomes are regressed on an index of density zoning developed from the work of Pendall for 50 U.S. metropolitan areas, while controlling for other metropolitan characteristics likely to affect urban housing markets and class segregation. Results. For both 2000 and changes from 1990 to 2000, OLS estimates reveal a strong relationship between density zoning and income segregation, and replication using 2SLS suggests that the relationship is causal. We also show that zoning is associated with higher inter-jurisdictional inequality. Conclusions. Metropolitan areas with suburbs that restrict the density of residential construction are more segregated on the basis of income than those with more permissive density zoning regimes. This arrangement perpetuates and exacerbates racial and class inequality in the United States.

Keywords: inequality, land regulation, segregation, zoning

JEL Classifications: R00, R14, R52, I3

Working Paper Series