Essays in Identity and Urban Economics.

Abstract

This dissertation explores aspects of identity choice and change in an economic context, and how choice of location can help predict “quality of life”.

The first chapter studies the malleability of race for those that are mixed-race. Many modern surveys that collect demographic information now allow one or more racial categories to be chosen for one person. I construct a simple model of racial identity choice which implies that cultural and socioeconomic factors will influence the racial choices of those with multiracial ancestry. Using nationally representative data from the Census and the American Community Survey (ACS) I show that factors such as region, year, age, employment, and wages are associated with race selection among this population. Therefore, measuring socioeconomic outcomes of multiracial groups may be complicated if these same socioeconomic outcomes influence self-reported race.

The second chapter examines relative group size, or whether a group is in the minority, a changeable social identity. We study how laboratory-created majorities and minorities interact, and how changing relative group size affects behavior. Our novel design allows us to examine whether two groups of unequal size exhibit differences in levels of trust and of trustworthiness and test whether causing the majority group to become the minority group, and vice-versa, changes behavior. We find that real-world majority race interacts with laboratory-created minority identity. We also find that subjects do not change their behavior when their relative group sizes change; behavior is driven by initial group size differences.

In the third chapter we examine variation in local rents, wage levels, commuting costs, household characteristics, and amenities for 2071 areas covering the United States, within metropolitan areas, by density and central-city status. We demonstrate the sensibility of estimating wage levels by workplace, not residence, and recover decentralized rent gradients that fall with commuting costs. We construct and map a willingness-to-pay index, which indicates the “quality of life” typical households receive from local amenities, when households are similar, mobile, and informed. This index varies considerably within metros, and is typically high in areas that are dense, suburban, sunny, mild, safe, entertaining, and have elevated school-funding.