In 1940, psychologists Carl Hovland and Robert Sears published a famous study linking lynchings in the South to low cotton prices. When times were hard, the authors argued, these kinds of hate crimes went up. The study's conclusions were widely accepted. The economic theory of hate crime, wrote one commentator, was "too good to be false."

Yet that's just what it appears to be. In an important article in The Journal of Personality and Social Psychology, Donald Green, Jack Glaser and Andrew Rich argued that when longer-term trends were taken into account, the supposed correlation between lynchings and low cotton prices disappeared.

Further, they found that lynchings did not rise during the Great Depression.

In another study, Green and other scholars found that hate crimes reported in New York City between 1987 and 1995 could not be correlated to the city's unemployment rate.

A similar 1999 study by Alan Krueger and Jörn-Steffen Pischke, published in The Journal of Human Relationships, found no relationship between the level of xenophobic attacks in Germany during the 1990s and either the unemployment rate or the level of education in the county where the attack occurred.

"Hate crime has much more to do with integration patterns and neighborhoods changing over time than it does with macroeconomic conditions," Green, a political science professor at Yale University, told the Intelligence Report.

"Hate crimes are most common when some new group is moving in and demographics are changing."

New Thinking on Fascism
Economic factors also seem irrelevant in explaining the existence of hate groups. Using the hate group listings compiled by the Southern Poverty Law Center for 1997, scholars Philip Jefferson and Frederic Pryor explored the characteristics of counties that had hate groups.

Of about 3,100 counties in the 48 contiguous states, 316, or more than 10%, were home to at least one hate group in 1997.

Yet counties where hate group chapters operated had unemployment rates typical of other counties. They also had typical divorce rates and typical differences in income between whites and blacks.

These results suggest that the presence of hate groups is not related to social decay or to whites who feel economically "threatened" by wealthier blacks.

Further, there was no interpretable relationship between the presence of hate groups in a county and high school graduation rates.

Jefferson and Pryor's 1999 study in Economic Letters concluded that "economic measures such as ... subsidies or ... social services will probably be much less important than strict law enforcement" in discouraging the formation of hate groups.

These sorts of results will come as a surprise to many who accepted the once mainstream academic view that xenophobia and racial hatred in Nazi Germany and fascist Italy could be directly traced to economic collapse in the 1930s.

According to the new thinking, European fascism was more due to systematic campaigns by political organizations than to economic hardship.

Racial Change is the Catalyst
The New York City study, written by Green, Dara Strolovitch and Janelle Wong and published in 1998 in the American Journal of Sociology, found that two factors best explained anti-minority hate crimes in the city's neighborhoods.

First, anti-minority hate crimes were positively correlated with the percentage of white residents in a neighborhood. The study found that 90%-white neighborhoods had twice as many anti-minority hate crimes as 50%-white ones, despite a higher incidence of interracial contact in the latter.

Second, anti-minority hate crimes were highest in traditionally white neighborhoods where there had been a recent influx of minorities.

For instance, both the Flushing section of Queens and Co-op City in the Bronx had 75% white populations in 1980. Ten years later, the percentage of Asians in Flushing had grown by 13%, while in Co-op City it remained unchanged.

Between 1987-1995, Flushing reported 11 times as many anti-Asian hate crimes as Co-op City.

Encouragingly, the model predicts that once urban areas are eventually integrated, hate crimes there should drop, as formerly homogenous neighborhoods cease to define themselves in terms of ethnicity.

But that process will take decades for many cities, the authors suggest. Suburbs, which typically integrate more slowly than cities, may present an even bigger challenge.

"Suburban areas have generally lacked the political will to establish police units focused on bias crime," says Green.

"As they integrate, and more hate crimes start occurring, will the police call them meaningless pranks and thereby help those who want to keep minorities out? Or will they refuse to tolerate that behavior, and signal that integration is welcome?"