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Galster, George, and Anna Maria Santiago. 1993. "Explaining the Growth of Puerto Rican Poverty, 1970-1980." PSC Research Report No. 93-272. February 1993.
Utilizing data from the 1970 and 1980 Public Use Samples, this study examines cross-metropolitan variations in Puerto Rican economic well-being using an instrumental variables regression model. The study addresses these questions: (1) To what extent are patterns of Puerto Rican residence a cause of Puerto Rican economic status? and (2) Are changes in Puerto Rican poverty rates from 1970 to 1980 a result of changing characteristics of the Puerto Rican population and the metropolitan areas in which they reside or because the way in which given values of these characteristics translated into poverty changed? Puerto Rican poverty rates in both 1970 and 1980 are examined in 34 communities in the United States that had populations of 2,500 or more Puerto Ricans in 1970. Between 1970 and 1980, the economic condition of Puerto Ricans deteriorated sharply. By the end of the period, the Puerto Rican poverty rate averaged 34% of the study's sample metropolitan areas -- a 50% increase since 1970. Results from regression analyses show that residential segregation was linked to higher Puerto Rican poverty in both 1970 and 1980. Although suburbanization relative to the centralized pattern of manufacturing employment proved an important determinant of poverty in 1970, by 1980 this and other connections with the manufacturing sector had dissolved. Decomposition of changes during the 1970s revealed that the primary sources responsible for increased Puerto Rican poverty rates were structural: the effects of segregation on poverty grew stronger during the decade and the ability of manufacturing employment and self- employment to attenuate poverty grew weaker. Changes in the value of manufacturing shares, female headship rates, and MSA unemployment rates were also important, however.