Social Consequences of Economic Segregation

Abstract

The empirical literature has not been successful in generating robust results for a positive relationship between income inequality and social unrest outcomes such as crime and suicide. This paper questions the use of standard income inequality measures (e.g., Gini coefficient) in such studies and shows that income-mobility-based measures are effective in explaining outcomes of social unrest. Analyses of Korean and the United States region-by-year data suggest that crime and suicide rates are better explained by income immobility (i.e., the degree of economic segregation) rather than the inequality aspects of income distribution. The explanatory power improves as a heavier weight is placed on the poor group's degree of immobility. Findings in the current study will be helpful for guiding future efforts to develop more effective measures of social unrest.