Urban Economics, Labor Economics, Economic History, Public Economics
Prior to the Great Migration, there were small communities of middle-class blacks living in the North. While research has investigated the importance of migration improving the fortunes of southern-born blacks, less is known about the impact of the Great Migration on existing black communities. I build a new panel dataset of black northerners to study how the arrival of new black residents shaped their economic fortunes. I exploit variation in the extent of in-migration across northern counties and instrument for black inflows by interacting pre-existing demographic patterns in the South with earlier black settlement patterns in the North. I find that in-migration resulted in significantly less employment but better occupational attainment for black northerners in 1930. The evidence shows that the effect of southern black in-migration on northern-born black outcomes is nuanced: low status northern-born blacks experienced more competition in the labor market, while high status northern-born blacks benefited more from occupational upgrading opportunities generated by in-migration.
Housing is the most important asset for the vast majority of American households and a key driver of racial disparities in wealth. This paper studies how residential segregation by race eroded black household wealth in U.S. cities. Using a novel sample of matched addresses from prewar American cities, we find that rental prices and occupancy soared by about 40 percent in blocks that transitioned from all white to majority black. However, home values fell on average by 10 percent over the first decade of racial transition and by a staggering 50 percent in major African American destinations such as Chicago, Philadelphia, and Detroit. These findings suggest that, because of the segregated housing market, black families faced dual barriers to wealth accumulation: they paid more in rent for similar housing while the homes they were able to purchase experienced marked declines in value.
Studies examining the racial difference in intergenerational mobility in the early twentieth century have mainly focused on southern blacks. Yet, small communities of middle-class blacks existed in the North prior to the Great Migration. These northern blacks began with a relatively better socioeconomic background than southern blacks and might have been better at capitalizing on their advantage in occupational attainment. Through building new samples of northerners with intergenerational linkages between 1910 and 1930, this paper shows that northern-born blacks had a different father-son occupational association from southern-born blacks; moreover, the father-son occupational association of northern-born blacks resembles more closely to that of northern-born whites than that of southern-born blacks. While the black-white mobility gap in this period would have closed in the South if blacks had the same occupational opportunity as whites, it would persist in the North. These findings suggest that heterogeneity shaped by regional origin within and across racial groups should not be overlooked in addressing racial disparities in economic mobility.