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Consumption Segregation

Author

Listed:
  • Corina Boar
  • Elisa Giannone

Abstract

This paper introduces consumption segregation, a new margin of residential segregation, and examines its patterns, causes, and discusses its aggregate consequences. We use new longitudinal and highly granular data to measure consumption segregation in the United States and document that it is high but relatively stable over the past 15 years, with substantial regional variation. We find that income segregation plays a more prominent role than other forms of segregation in driving consumption segregation, mainly due to the inability to smooth shocks to income. We illustrate a new mechanism through which, in the presence of social comparisons, consumption segregation can exacerbate wealth inequality.

Suggested Citation

  • Corina Boar & Elisa Giannone, 2023. "Consumption Segregation," NBER Working Papers 31133, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:31133
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    File URL: http://www.nber.org/papers/w31133.pdf
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    Cited by:

    1. Wang, Bei & Qian, Xuefeng & Li, Ying & Cao, Jia, 2024. "Pro-poor consumption effects of trade liberalization: Evidence from China," China Economic Review, Elsevier, vol. 86(C).

    More about this item

    JEL classification:

    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • R2 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis

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