The US has a long history of housing discrimination. Since the passage of the Fair Housing Act, HUD has sought to measure the extent of that discrimination with a series of audit studies. Critiques of audit studies have questioned the ability of these and other similar experimental methods to measure discrimination on the margins where individuals are affected in actual market contexts. We implement the largest correspondence study of discrimination in rental housing markets, and show how combining the results with actual market outcomes and with structural estimation techniques can confirm that discrimination indeed has market consequences, and that sorting behavior on the part of market participants can actually make the consequences of that discrimination worse.
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