Sort Selling: Political Polarization and Residential Choice
56 Pages Posted: 9 Mar 2021
Date Written: March 6, 2021
Partisanship and political polarization are salient features of today’s society. We merge deeds records with voter rolls and show that political polarization is more than just “political cheerleading.” Descriptively, homeowners are more likely to sell their homes and move when their next-door neighbors are affiliated with the opposite political party. We use a novel, new-next-door-neighbor identification strategy along with rich demographic control variables and time-by-geography fixed effects to confirm causality. Consistent with a partisanship mechanism, our results are strongest when new next-door neighbors (i) are more likely to be partisan and (ii) live especially close by. Our findings help explain increases in political segregation, improve our understanding of residential choice, and illustrate the importance of political polarization for economic decision-making.
Keywords: Political Polarization, Residential Choice
JEL Classification: D10, H31, R20
Suggested Citation: Suggested Citation