(DP 1980-11) Racial Preferences and Housing Prices

Abstract

This paper studies and tests a hypothesis about how racial preferences influence the choice of urban residential location. The hypothesis implies a pattern of housing prices which lead to racial segregation. Data from San Mateo Country, California is used in the study. Utilizing the technique of hedonic price index estimation, the paper concludes that the empirical results are consistent with the hypothesis of racial preferences by households which ultimately result in racial segregation.