Causes and Consequences of Separate and Unequal Neighborhoods

Margery Austin Turner and Solomon Greene

In cities, suburbs, and rural communities across the United States, our neighborhoods remain stubbornly segregated along racial and ethnic lines. A typical white person lives in a neighborhood that is 75 percent white and only 8 percent African American, whereas a typical African American person lives in a neighborhood that is only 35 percent white and 45 percent African American. Moreover, people of color are overrepresented in neighborhoods with high poverty rates, where essential resources like quality schools, full-service grocery stores, safe and healthy parks, and reliable transportation are often lacking.

These patterns are not explained by income disparities or personal preferences. A middle-income Black family is more likely to live in a poorly resourced neighborhood with a high poverty rate than a low-income white family. And although households of all races and ethnicities increasingly say they prefer integration, discrimination against people of color in housing and lending persists and the effects of past racist public policies continue to be felt.

This explainer recounts the history of public policies and institutional practices that built and sustain separate and unequal neighborhoods in the United States. It also briefly summarizes evidence of the profound and lasting consequences these policies and practices have for people’s quality of life and access to opportunity, including inequities in education, health, wealth, and employment.

How America Built Separate and Unequal Neighborhoods

America’s separate and unequal neighborhoods did not evolve naturally or result from unfettered market forces. Rather, they resulted from plans, policies, and practices of racial exclusion and disinvestment that primarily targeted Black people and laid the foundation for the segregation of other people of color. These policies and practices systematically denied Black people access to well-resourced and opportunity-rich neighborhoods while denying the neighborhoods where they and other people of color live access to resources and investments, leaving them with failing schools, inadequate services, physical and environmental blight, and high levels of crime and violence.

Early in the 20th century, millions of Black people who migrated from the rural South to the industrial cities of the Northeast and Midwest were constrained to designated neighborhoods by local zoning ordinances, restrictive covenants, and violence. Racially restrictive covenants legally prohibited African Americans from owning, leasing, or occupying homes in designated communities, providing a legal framework for the systematic segregation of people of color until the late 1940s. Long after the Supreme Court ruled that racial covenants were unenforceable, they continued to be used as powerful social signals to exclude people of color.

The federal government also helped create and reinforce patterns of racial segregation and uneven investment in neighborhoods throughout most of the 20th century. Beginning in the 1930s, the Federal Housing Administration refused to insure mortgages in African American neighborhoods. After World War II, the nation’s renewed economic prosperity fueled the development of suburban communities, creating new political jurisdictions and school districts. Ongoing redlining combined with local policies and prevailing real estate practices to exclude Black families from most burgeoning suburban communities and to deny loans to residents of predominantly Black neighborhoods. Federal transportation investments also reinforced residential segregation, facilitating automobile access among residents of the growing, predominantly white suburbs while constructing inner-city highways that cut through existing neighborhoods, often creating physical barriers that blocked Black communities’ access to downtown areas and other centers of economic opportunity. Meanwhile, the development of federally subsidized housing further established starkly segregated living patterns: at its inception, such housing was legally required to be segregated by race, and developments slated for occupancy by Black households were built either in Black neighborhoods or in isolated, undeveloped areas.

The racial segregation of neighborhoods and the denial of capital to people of color fueled the geographic concentration of poverty, disinvestment by public and private institutions, and neighborhood distress. More specifically, discriminatory policies and practices confining Black people—for whom the incidence of poverty was markedly higher than for white people—to particular city neighborhoods produced much higher poverty rates in those neighborhoods. High rates of poverty exacerbated the flight of capital and essential services, reinforcing the effects of racist policies and practices on neighborhoods. Today, virtually all urban and suburban neighborhoods with high poverty rates are predominantly occupied by people of color, and among households experiencing poverty, white households are much more geographically dispersed than Black or Latinx households.

In the 1960s and 1970s, the federal government responded to inner-city distress with the urban renewal program, which often exacerbated problems in urban neighborhoods with large shares of Black residents and high rates of poverty. Cities that received urban renewal funding used eminent domain to condemn and raze housing and other properties in poor neighborhoods occupied by Black people and businesses and then redevelop the land in accordance with city plans. Some residents were moved to newly constructed public housing—often built in isolated or undesirable areas—creating new neighborhoods of concentrated poverty and disadvantage.

Forces Sustaining Neighborhood Segregation

In the mid-20th century, courts and Congress began to outlaw racial discrimination in housing and lending. The Fair Housing Act of 1968 prohibited racial discrimination in the renting, selling, and financing of housing and lifted many formal barriers to residential integration. However, explicit discrimination was quickly replaced by subtler and ostensibly "race-neutral” methods of excluding people of color from predominantly white neighborhoods.

Exclusionary zoning policies—such as large lot-size requirements and large square-footage-per-dwelling-unit mandates—make it difficult for low- and even moderate-income households to live in many well-resourced communities. Federal and local subsidized housing programs also continue to prioritize building affordable housing in already distressed neighborhoods. Moreover, discrimination in housing and lending markets persists and continues to evolve in ways that can be harder to detect and combat, such as agents showing fewer units to well-qualified homeseekers of color or screening applicants using algorithms with built-in biases.

Although discrimination in housing and lending persists, merely prohibiting individual acts of discrimination cannot reverse entrenched patterns of residential segregation. And the Fair Housing Actdid more than prohibit discrimination in housing market transactions: it also required that federal housing and community development funds be used to “affirmatively further fair housing” and thus to reverse racial segregation and expand access to opportunity for protected groups. However, this requirement has been inconsistently and weakly enforced. In 2015, the US Department of Housing and Urban Development adopted a rule that, for the first time, rigorously enforced that requirement, but the Trump administration rescinded it.

The legacies of early forms of discrimination have also proved more enduring than formal legal changes would suggest. Living in segregated neighborhoods has blocked people of color from the educational opportunities, jobs, and wealth building necessary to access well-resourced neighborhoods, while generations of white families have benefited from the structural advantages of the opportunity-rich neighborhoods in which they live. And neighborhoods occupied by people of color often lack the quality services and housing stock necessary to appeal to white homeseekers, who may have many other options. As a result, many people of color remain locked in disinvested neighborhoods, while predominantly white neighborhoods grow and prosper more readily.

Gentrification is also perpetuating segregation in some US cities. When higher-income (often white) “gentrifiers” move into neighborhoods occupied by people with lower incomes and people of color, they can quickly drive up rents and property taxes, pushing out long-time residents and businesses. Without adequate affordable housing supply or protections in place, long-time residents of color can be displaced when capital flows back into their neighborhoods. Even for long-time residents who manage to remain in gentrifying neighborhoods, cultural displacement, rising costs of services, and social distance from new residents may erode their sense of belonging and impede access to new economic opportunities.

Residential Segregation Perpetuates Racial Inequity and Injustice

America’s history of residential segregation has produced a system of neighborhoods that are not only separate but structurally unequal. Racial discrimination, poverty, and the political fragmentation of metropolitan regions all undermine the political and market power people and communities need to garner quality services from government and the private sector. The poor quality of public schools in many communities of color is arguably the most consequential challenge, but communities of color typically lack many other public and private services like quality health centers, food markets, parks and recreational facilities, and transit, with detrimental consequences for people’s near-term well-being and long-term life chances.

High levels of crime and violence also have dire consequences for many communities of color, especially those with high rates of poverty. The toxic stress of exposure to violence undermines physical and mental health and can disrupt children’s healthy development and ability to learn. Violence and crime can make school and work commutes dangerous, create unsafe school environments, and disrupt learning in the classroom, and they make it more difficult for residents to find safe spaces to exercise and play outdoors. Crime and violence also increase police presence, with potentially devastating consequences for residents: although police are charged with keeping communities safe, many departments do so with intensive tactics that emphasize street stops and high concentrations of officers in “hot spots.” These tactics are most often applied to communities of color, contributing to disproportionate rates of justice system involvement, high rates of arrest and incarceration, and, in the most tragic circumstances, fatal encounters with police.

Because race and place are so tightly connected in the United States, neighborhood disparities in access to opportunity create and widen racial inequities across almost every domain of social and economic life. Racial segregation stunts house price appreciation (and, consequently, wealth accumulation among Black and Brown homeowners), undermines children’s educational attainment, limits employment opportunities and earnings, and damages the health of children and adults. Children who grow up in more racially segregated metropolitan areas experience less economic mobility than those in less segregated ones, and more racially and economically segregated regions tend to have lower incomes and educational attainment and higher homicide rates.

Recent analysis of the long-term consequences of neighborhood conditions confirms the critical role of place in shaping children’s economic trajectories: moving to better-resourced neighborhoods improves economic outcomes, especially for children who escape disinvested communities when they are young and therefore experience greater exposure to better environments. Moreover, living in a disinvested neighborhood may undermine some outcomes across generations. For example, children whose parents grew up in neighborhoods with high poverty rates scored dramatically worse on reading and problem-solving tests than those whose parents grew up in neighborhoods with low poverty rates, other things being equal. In other words, separate and unequal neighborhoods perpetuate educational and economic inequities across generations.

The COVID-19 pandemic and its economic fallout have made the costs of segregation painfully apparent. Black and Brown people are getting sick and dying, losing employment income, and suffering from food and housing insecurity at higher rates than white people. And growing evidence demonstrates that the health and economic consequences of the pandemic are affecting neighborhoods differently based on their racial composition. Across the United States, disparities in the effects of COVID-19 are driven by long-standing structural barriers and inequitable neighborhood conditions.


Essential Sources

Briggs, Xavier de Souza, ed. The Geography of Opportunity: Race and Housing Choice in Metropolitan America. Washington DC: Brookings Institution Press, 2005.

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Cashin, Sheryll. Failures of Integration: How Race and Class Are Undermining the American Dream. New York: PublicAffairs, 2005).

  • Describes how laws and policies related to housing, land use, education, and transportation created enduring patterns of segregation in neighborhoods and schools.

Charles, Camille Zubrinsky. “The Dynamics of Racial Residential Segregation.” Annual Review of Sociology 29 (August 2003): 167–207.

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Chetty, Raj, and Nathaniel Hendren. “The Impacts of Neighborhoods on Intergenerational Mobility I: Childhood Exposure Effects.” Quarterly Journal of Economics 133, no. 3 (August 2018): 1,107–162.

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Ellen, Ingrid Gould, and Justin Peter Steil, eds. The Dream Revisited: Contemporary Debates About Housing, Segregation, and Opportunity. New York: Columbia University Press, 2019.

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Greene, Solomon, Margery Austin Turner, and Ruth Gourevitch. “Racial Residential Segregation and Neighborhood Disparities.” Washington, DC: Urban Institute, 2017.

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Massey, Douglas S., and Nancy A. Denton. American Apartheid: Segregation and the Making of the Underclass. Cambridge, MA: Harvard University Press, 1993.

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Oliver, Melvin L., and Thomas M. Shapiro. Black Wealth/White Wealth: A New Perspective on Racial Inequality. New York: Taylor & Francis Group, 2006. Describes the causes and consequences of the racial wealth gap.

powell, john, and Stephen Menendian. “Segregation in the 21st Century.” Poverty & Race 25, no. 1 (March 2013): 1, 14–17.

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Rothstein, Richard. The Color of Law: A Forgotten History of How Our Government Segregated America. New York: Liveright Publishing Corporation, 2017.

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Sharkey, Patrick. Stuck in Place: Urban Neighborhoods and the End of Progress toward Racial Equality. Chicago: University of Chicago Press, 2013.

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Turner, Margery Austin, Susan J. Popkin, and Lynette A. Rawlings. Public Housing and the Legacy of Segregation. Washington, DC: Urban Institute Press, 2009.

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