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How Race Determines Restaurant Choice in New York

Consumption segregation is lower than residential discrimination

It turns out New Yorkers’ restaurant choices hinge on more than five-star online reviews.  

Racial groups make divided consumption choices, based on an analysis of New York City restaurant patronage by Columbia University’s Donald Davis and co-authors. That study leads this week’s economic research roundup, which also digs into work on March Madness’s alcohol-fueled side effects, the factors weighing on interest rates and consumer confidence’s real-world impact. Check back each week for new and interesting economic work from around the globe. 

Race and restaurants in New York

While residential segregation is a well-documented trend in the U.S., consumption segregation is less-frequently studied. In this study, the authors look at racial and ethnic divides in New York City restaurant patronage by looking at reviews.

They find that consumption choices are actually only about half as segregated as housing decisions. Yet restaurant choices do divide along social lines: Yelp users are more likely to go to places that are demographically similar to the community in which they live, or which have a larger share of residents in their racial group. 

How Segregated is Urban Consumption?
Published September 
Available on the NBER website

Basketball and binge drinking

“March Madness,” the U.S. men’s college basketball tournament, comes with a side effect on campus. Binge drinking increases 30 percent for schools that participate (downing five or more drinks at once is considered a binge) and self-reported drunk driving jumps 9 percent for male students, based on a new study by the University of Nebraska at Omaha’s Dustin White and co-authors. Women are also more likely to drive drunk during the tournament, but the change isn’t big enough to be statistically significant. 

This isn’t the first study to show that big sports and bad behavior dovetail on campus: a 2015 study showed that college football games were associated with a higher incidence of sexual assault. 

March Madness: NCAA Tournament Participation and College Alcohol Use
Published September 
Available on the NBER website

Good vibes bring good economies

Consumer confidence really could drive economic activity, new research  from the European Central Bank suggests. The researchers look at consumer and business confidence and economic policy uncertainty measures across 27 advanced countries from 1985 to 2016, and find that movements in the various measures are correlated across countries – suggesting a global factor – and move fairly closely with economic and financial variables. Consumer confidence is positively associated with future inflation, past and present industrial production growth, and inflation-adjusted house price growth, for example. 

More than a feeling: confidence, uncertainty and macroeconomic fluctuations
Published September  2017
Available on the European Central Bank website

Pay and productivity 

Slow U.S. productivity growth partly explains soft wage growth over the course of the economic recovery, Bank of America researchers find. The economists look at growth in the Employment Cost Index as a function of productivity growth and the unemployment rate, and find that wages should have grown at 1.4 percent during the recession and 5.8 percent during the recovery, based on their 1980-2007 model, versus the 0.7 percent and 4.2 percent we’ve actually seen. The good news? The researchers see this as a sign that wages should be headed for an acceleration.

To Get Paid, Stay Productive
Published Sept. 15
Available to Bank of America US Economic Weekly subscribers


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