Buying in: Positional competition, schools, income inequality, and housing consumption

Adam Goldstein, Orestes P. Hastings

Research output: Contribution to journalArticlepeer-review

13 Scopus citations

Abstract

Social scientists have suggested that a key sociobehavioral consequence of rising inequality is intensifying market competition for advantageous positions in the opportunity structure, such as residences that afford access to high-quality public schools. We assess empirical implications of inequality-fueled positional competition theories (PCTs) by analyzing the relationships between metropolitan income inequality, households' efforts to secure residential positions in desirable school districts, and housing consumption behavior. We assemble a unique data set, which contains longitudinal information on household finances, residences, and geographic locations from the Panel Study of Income Dynamics; information on the quality of the school attendance areas in which these households reside; and information about the local real estate market. We find that greater inequality is associated with steeper housing price premia for residences in desirable areas, more pronounced social class sorting on school quality when relocating, and greater salience of schools relative to other housing amenities in families' housing expenditure functions. Families in high-inequality regions exhibit modestly greater willingness to pay more (relative to their own incomes) for a given improvement in school desirability. The analysis brings important empirical nuance to oft-invoked but untested theories about positional competition as a mechanism by which inequality affects behaviors, consumption, and markets.

Original languageEnglish (US)
Pages (from-to)416-445
Number of pages30
JournalSociological Science
Volume6
DOIs
StatePublished - 2019

All Science Journal Classification (ASJC) codes

  • General Social Sciences

Keywords

  • Consumption
  • Housing
  • Inequality
  • Positional competition
  • School attendance areas

Fingerprint

Dive into the research topics of 'Buying in: Positional competition, schools, income inequality, and housing consumption'. Together they form a unique fingerprint.

Cite this