Segregation and Poverty Concentration

Abstract

A key argument of Massey and Denton's American Apartheid (1993) is that racial residential segregation and non-white group poverty rates combine interactively to produce spatially concentrated poverty. Despite a compelling theoretical rationale, the empirical tests of this proposition have been negative or mixed. This paper develops a formal decomposition model that expands the Massey model of how segregation, group poverty rates, and other spatial conditions combine to form concentrated poverty. The revised decomposition model allows for income effects on cross-race neighborhood residence and interactive combinations of multiple spatial conditions in the formation of concentrated poverty. Applying the model to data reveals that racial segregation and income segregation within race contribute importantly to poverty concentration, as Massey argued, but that almost equally important for poverty concentration is the disproportionate poverty of the non-group neighbors of blacks and Hispanics. The missing interaction Massey expected in empirical tests can be found with proper accounting for the factors in the expanded model. "Because of racial segregation, a significant share of black America is condemned to experience a social environment where poverty and joblessness are the norm, where a majority of children are born out of wedlock, where most families are on welfare, where educational failure prevails, and where social and physical deterioration abound. Through prolonged exposure to such an environment, black chances for social and economic success are drastically reduced."--Douglas Massey and Nancy Denton, American Apartheid, p. 2.