Ruhr Economic Papers

Ruhr Economic Papers #914

Segregation, Housing and Neighborhood Dissimilarities: A Case Study for the City of Bochum

by Said Benjamin Bonakdar

RUB, 06/2021, 42 S./p., 8 Euro, ISBN 978-3-96973-059-1 DOI: 10.4419/96973059

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Abstract

The rising concentration of low-income households and ethnic minorities has become an important policy issue in Germany. The Ruhr Area is particularly interesting, because it is one of the largest conurbations in Europe and experienced radical structural changes in the past, which are connected to the boom and the deindustrialization of the coal mining and steel industry. Since there is no empirical evidence about the extent of residential segregation within the cities of the Ruhr Area, I use micro data on house-coordinates levels to investigate the urban structure of Bochum, which is located in the center of the conurbation. The results show that Bochum can be characterized by four different clusters under consideration of socioeconomic variables, dwelling rents and psychological indicators, e.g. captured by the so-called Sinus Milieus and Limbic Types. With a CHAID decision tree on dwelling rents I learned that especially dwelling size is a key separator between higher and lower dwelling prices in Bochum. The variables identified in the decision tree, like e.g. number of rooms or construction year, are used for hedonic price estimations within all clusters and show positive effects on dwelling rents. Finally, I found that, across all clusters, a rise in different satisfaction types also increase the odds of houses to be located in neighbourhoods with positive moving balance, which is a proxy for a high willingness-to-stay.

JEL-Classification: R21, R23, R31

Keywords: The rising concentration of low-income households and ethnicUrban housing; housing prices; rent; neighbourhood characteristics; segregation

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