Template-Type: ReDIF-Paper 1.0
Author-Name: Dilip Mookherjee
Author-X-Name-First: Dilip
Author-X-Name-Last: Mookherjee
Author-Email: dilipm@bu.edu
Author-Workplace-Name: Boston University
Author-Name: Stefan Napel
Author-X-Name-First: Stefan
Author-X-Name-Last: Napel
Author-Email:
Author-Workplace-Name: University of Bayreuth
Author-Name: Debraj Ray
Author-X-Name-First: Debraj
Author-X-Name-Last: Ray
Author-Email: 
Author-Workplace-Name: New York University
Title: Aspirations, Segregation and Occupational Choice 
Abstract: This paper examines steady states of an overlapping generations economy with a given distribution of household locations over a one-dimensional interval. Parents decide whether or not to educate their children. Such decisions are aected by location: parental aspirations depend on the earnings of their neighbors. At the same time, economy-wide wages endogenously adjust to bring factor supplies into line with demand. The model therefore combines local social interaction with global market interaction. The paper studies steadystate configurations of skill acquisition, both with and without segregation, and studies the macroeconomic and welfare effects of segregation on aggregate economic outcomes.
Length: 28
Creation-Date: 2008-07
Revision-Date: 
Publication-Status: 
File-URL:http://www.bu.edu/econ/ied/dp/papers/dp%20182.pdf
File-Format: Application/pdf
File-Function: 
Number: dp-182
Classification-JEL: 
Keywords: 
Handle: RePEc:bos:iedwpr:dp-182