Mark Alan Hughes

Residential segregation and the economic status of black workers: New evidence for an old debate

Abstract Scholars have long debated whether ghetto residence lowers the earnings of blacks. Most empirical studies on this question have been flawed because they have not considered the simultaneous effects of choices of work and residence locations and the effects of intrametropolitan variation in rents and wages. This paper estimates a revealed preference model of intraurban location with data from the 1980 Public Use Microdata Sample for Cleveland, Detroit, and Philadelphia to test whether black male household heads who are employed full-time year-round are less likely than whites to live and work at their best locations. We measure the wages, rents, and commuting costs associated with each possible job/residence location combination in these cities for each person, given their job qualifications and their housing needs. A revealed preference approach is used to evaluate the economic welfare of individuals at each possible location and then compare the actual distribution of work and residence locations by race with the welfare-maximizing distribution. The divergence in these distributions by race measures the economic effects for employed black male household heads of residential segregation in ghettos. We find that the economic status of blacks can be improved significantly by changing their intrametropolitan job locations. Surprisingly, this conclusion holds regardless of whether or not blacks keep their current residential locations. While changes in residential locations can improve the economic status of blacks relative to whites by decreasing commuting and/or the cost of housing, such residential changes do not significantly alter the physical accessibility of better paying jobs.

FORMATION OF THE IMPACTED GHETTO: EVIDENCE FROM LARGE METROPOLITAN AREAS, 1970-1980

A metropolitan measurement strategy is employed to consider whether any increased incidence of isolated deprivation is observable among the larger metropolitan areas of the United States. The measurement strategy is significantly different from those used in other empirical studies of contemporary inner-city poverty, and the strategy is described in detail. The results indicate a general increase in isolated deprivation and a considerable increase in a particular set of metropolitan areas. This trend is characterized as the formation of an impacted ghetto. This characterization is supported by a spatial analysis of isolated deprivation in the metropolitan areas containing the largest impacted ghettos. The relation between impacted-ghetto formation and metropolitan restructuring is hypothesized and further research outlined.

Concentrated deviance and the “underdass” hypothesis

The “underclass” is perhaps the defining feature of current research in urban distress and of current debates regarding urban policy. The leading measurement strategy (proposed in this journal) is somewhat divorced from the careful specifications of the leading theoretical work (notably that of W. J. Wilson). Several alternative measurement strategies demonstrate that the findings are extremely sensitive to the measurement used. Theory is the only reliable basis for choosing a measurement strategy and for avoiding the empiricist approach taken by other studies. If we cannot identify the best measurement strategy, then there is no basis for further research or for recommending policies.