Immigrants and Native Flight: Geographic Extent and Heterogeneous Preferences

Is ethnic segregation in Europe driven by native flight or immigrant self-isolation? If the former, which natives avoid immigrants? Which immigrants? What is the geographic scope of homophilic residential preferences? We answer these questions using a matched panel containing the universe of individuals and properties in Denmark from 1987 through 2017. We take advantage of the quasi-random nature of refugee placements and simulated exogenous Markov-chain predictions to generate experimental variation regarding local immigrant arrivals. We find strong evidence of native flight, even at the building level. Flight is stronger among the old and a reaction to the arrival of low-income immigrants. As neighborhoods become more immigrantdense, housing prices decline, and subsequent move-ins are more likely to be other immigrants or young, low-income native citizens without children.