This paper investigates the impact of ethnic diversity on individuals? overall satisfaction with and other aspects of their neighbourhood. It uses panel data and a variety of empirical methods to control for potential endogeneity of diversity and of the location choices. We find that a higher white share in the neighbourhood raises overall satisfaction with the neighbourhood in our (overwhelming white) sample, but has no significant impact on generalised trust or other commonly-used measures of social capital. We suggest that part of the impact of diversity on overall neighbourhood satisfaction may be through an effect on a fear of crime and the quality of social life.

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14 December 2016     Paper Number CEPDP1459

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This CEP discussion paper is published under the centre's Community Wellbeing programme.

This publication comes under the following theme: Community cohesion