Not so Nosy Neighbors

by Elaine Schwartz    •    Mar 28, 2012    •    654 Views

By Mira Korber, guest blogger.

You are like your neighbors, but not for the reasons you might think.

Here are some general assumptions about neighborhoods (all quoted from this Atlantic article):

“(1) Neighborhoods are important centers of American life. (2) The residents of American neighborhoods talk to each other. (3) Politics is an important topic of their discussions.”

Two researchers, Samuel J. Abrams and Morris P. Fiorina, have refuted the aforementioned assumptions; they interpreted a 2005 Georgetown University survey of 1,001 people, showing that only 1.8% of the participants “usually” discuss politics with their neighbors. Therefore, according to Abrams and Fiorina:

“Americans today do not know their neighbors very well…and they do not see themselves as swimming in a sea of like-minded people…even if geographic political sorting were ongoing, its effects would be limited by the preceding facts about contemporary neighborhood life.”

The researchers argued that neighborhoods house similar people because of shared interest in what the location itself has to offer. For example, people who value education, high-paying jobs, or a sophisticated social scene tend to congregate not because they know each other, but because they seek those community traits.

Your neighbor might want the same education for his daughter as you want for yours, but it doesn’t mean you know each other. Therefore, community “sorting” occurs, and income inequality gaps increase due to educational disparities among communities rather than social herding.

The Economic Lesson

Read the following Huffington Post charts, which show the steadily increasing income inequality gap in the US. A few notable figures include the child poverty rate (21.9%), which is second only to Mexico (24.8%), the average American CEO’s pay (1039 times greater than the average worker), and homelessness rate (1 in 5 people). Additionally, this Economist article explains who makes up America’s wealthiest “1%.”

An Economic Question: In what ways have you noticed an income gap between the rich and the poor?

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