Ed Glaeser has co-written a new paper with Matt Resseger and Kristina Tobio that surveys issues in urban inequality. It is very good and well worth a read. Some of my favorite lines:

New York may be much more expensive for a relatively rich person than it is for a relatively poor person.

[W]e find that the share of the population enrolled in college in 1850 is a quite solid predictor of income inequality today.

Egalitarians can simultaneously hope for policies that would reduce inequality at the national level, such as increasing the schooling levels for least fortunate, while opposing policies that would reduce local income inequality by moving rich people away from poor people.

There’s really too much to discuss in one post, but let me highlight a few excerpts that provide a nice illustration of the key issues. First, the authors’ find that at least one-third of inequality levels can be explained by differences in skill or human capital levels. Skill matters, and:

In our data, the most powerful correlate of the returns to having a college degree is the share of population with college degrees, but that fact provides more confusion than clarity.  The correlation could reflect skilled people moving to areas where there are large returns to skill. Alternatively, it might reflect human capital spillovers which cause the returns to skill to rise.

Skill attracts skill. And human capital levels are rooted in history:

Sixty percent of the heterogeneity in skills across larger metropolitan areas can be explained by the share of high school dropouts in the area in 1940 and the share of the population that is Hispanic. Long-standing historical tendencies are highly correlated with the location of high school dropouts and the location of Hispanic immigrants today.

Finally:

Our final point is that America’s current schooling system puts localities at the center of any attempts to reduce national inequality through a more equal human capital distribution.  While localities are inherently weak in their abilities to reduce inequality, decentralized schooling means that any attempt to equalize educational opportunities must rely heavily on localities. Not only will attempts to reduce inequality through more equal education take many years, but they will also require a tricky partnership between national and local governments.

Taken together, these passages tell a story about the persistence of inequality. This is a story we need to understand. Our history is written in our cities, in their neighborhoods and institutions. That history shapes the kinds of schools children attend, how long they stay in them, where they live as adults, what they earn, and so on. Economic and political geography ought to be at the heart of many of the domestic policy choices we make, but it isn’t.