Victoria Gregory, Federal Reserve Bank of St. Louis

"The Impact of Racial Segregation on College Attainment in Spatial Equilibrium"

Abstract

This paper seeks to understand the forces that maintain racial segregation and the Black-White gap in college attainment, as well as their interactions with place-based policy interventions. We incorporate race into an overlapping-generations spatial-equilibrium model with neighborhood spillovers. Race matters due to: (i) a Black-White wage gap, (ii) amenity externalities—households care about their neighborhood’s racial composition—and (iii) additional barriers to moving for Black households. We find that these forces account for 71% of the racial segregation and 64% of the Black-White gap in college attainment for the St. Louis metro area. The presence of spillovers and externalities generates multiple equilibria. Although St. Louis is in a segregated equilibrium, there also exists an integrated equilibrium with a lower college gap. We show that place-based policy interventions can reduce segregation and destabilize the segregated equilibrium.

Victoria Gregory is an an economist in the Research Division of the Federal Reserve Bank of St. Louis.

Her research interests are in macroeconomics and labor economics. My work combines structural modeling and micro data to understand topics related to labor market dynamics.

You can read more about Victoria Gregory here

CEBI contact: Ida Hartmann & Søren Leth-Petersen