Who We'll Live With: Neighborhood Racial Composition Preferences of Whites, Blacks and Latinos

The debate about racial residential preferences has two open questions. First, are neighborhood racial preferences truly racial, or is race a proxy for socio-economic factors? Second, are in-group or out-group preferences more salient? Using the Houston Area Survey, we employ a factorial experiment to assess the effect of racial composition on neighborhood desirability independent of crime, school quality and property values. We survey whites, blacks and Hispanics to examine in-group vs. out-group preferences. Results show that independent of proxies, whites find neighborhoods less attractive as the proportion black or Hispanic increases; the proportion Asian has no impact. Racial composition has little effect on Hispanics' and blacks' neighborhood preferences. We find no evidence of in-group preferences; rather, results suggest that whites express negative out-group preferences toward black and Hispanic neighborhoods.