WORKING PAPERS

ETHNIC DISCRIMINATION IN THE HOUSING MARKET: EVIDENCE FROM ISRAEL

Job market paper link

Israel is characterized by a very high degree of residential segregation along ethnic lines: Arabs and Jews live in different localities or in separate neighborhoods within ethnically integrated localities. This paper is the first to explore the role of discrimination in creating this pattern. Using a large-scale correspondence study in the online market for rental housing, I show that Jewish landlords are 2.4 times (or 49 percentage points) more likely to confirm the availability of a posted property when receiving a query from a Jewish rather than an Arab potential renter. A nominally independent survey of these landlords reveals that discrimination is mainly driven by tastes.