Ethnic Preferences and Residential Segregation: A Simulation Study

Miruna Petrescu-Prahova, University of California, Irvine

Individual preferences for neighborhood ethnic composition have been identified as playing a major role in determining the spatial distribution of ethnic groups within modern cities. In this paper, we use a statistical framework based on discrete exponential family models to simulate the way in which xenophobia (i.e., a preference not to reside in the same neighborhood as dissimilar alters) and homophily (i.e., a preference to reside in the same neighborhood as similar alters) combine with other factors to influence the spatial distribution of households to neighborhoods. We conclude that the presence of xenophobia almost always leads to segregation, whereas the effect of homophily depends on its interaction with other factors. These results show that making a distinction between these two types of preferences can provide important insights into the process of residential segregation.