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Choice of Neighbourhoods by Mover Households in Karachi

Applied Economics Research Centre, University of Karachi, P.O. Box 8403, Karachi 75270, Pakistan

The paper studies the factors which influence choice of location of mover households between neighbourhoods in the city of Karachi. The analysis is based on a socio-economic survey of 6275 households in the city. Permanent income, location-specific income (income earned in the neighbourhood of residential location), ethnic composition and the incidence of violence are major determinants of the neighbourhood choice. The significance of location-specific income, level of violence and ethnic composition and insignificance of levels of services indicate that the choice of location and neighbourhoods is driven by different considerations in a developing country from those in a developed one. The results of the analysis show that in future there is likely to be ethnic segregation of population by their ethnic background and movement of households toward violence-free areas. Movement away from employment opportunities, especially for households who are self-employed and attached to a particular location for their livelihood, is less likely.

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