Income Segregation and the Rise of the Knowledge Economy
- (pp. 69-102)
Abstract
We analyze the effect of an increase in knowledge-intensive activities on spatial inequality in US cities. We leverage a predetermined network of patent citations to instrument for local innovation trends. Between 1990 and 2010, a one-standard-deviation increase in patent growth increases income segregation by 0.65 Gini points, corresponding to 0.31 standard deviations of the over-time change in income segregation. This effect mainly arises from the sorting of residents by income, occupation, and education. Local shocks to innovation induce a clustering of knowledge-intensive jobs and residents, amplified by the response of rents and amenities.Citation
Berkes, Enrico, and Ruben Gaetani. 2023. "Income Segregation and the Rise of the Knowledge Economy." American Economic Journal: Applied Economics, 15 (2): 69-102. DOI: 10.1257/app.20210074Additional Materials
JEL Classification
- D31 Personal Income, Wealth, and Their Distributions
- O31 Innovation and Invention: Processes and Incentives
- O33 Technological Change: Choices and Consequences; Diffusion Processes
- O34 Intellectual Property and Intellectual Capital
- R23 Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics
- R32 Other Spatial Production and Pricing Analysis
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