Persistent Stigma in Space: 100 Years of Japan's Invisible Race and Their Neighborhoods

Abstract We provide evidence of a large and persistent land price discount in neighborhoods historically inhabited by the outcaste group (buraku) in Japan. Our border design shows that this price discount declined from 53% in 1912 to 11% in 2006 but remained constant thereafter. Furthermore, we provide evidence that the vestiges of territorial stigma of buraku areas is the primary cause of these persistently lower land prices. Living in the stigmatized buraku area increases the risk of being identified as buraku and experiencing discrimination. Therefore, the lower land prices reflect the higher discrimination risk in the spatial equilibrium of our model.