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With mass emigration from Italy during the 1880s, the majority of Italians settled in ethnic districts called Little Italies, mostly in U.S. northeastern cities such as East Harlem and the Lower East Side in New York, the North End in Boston, and Federal Hill in Providence. There were also large communities in Chicago (Near West Side) and San Francisco (Fisherman's Wharf). In addition, thousands settled in small towns in states such as New Jersey and in upstate New York, while a tiny minority chose rural settlements.

The choice to live in these districts was made because of the low cost of housing and their proximity to workplaces, coupled with the persistence of Italian culture with the continual arrival of further migrants as a result of diffused seasonal mobility from Italy. Inside the Little Italies, migrants originating from the same town or region were usually concentrated in the same streets and lived in tenements composed of dark and uncomfortable apartments, where families would share amenities. In the 1890s, photographer Jacob Riis reported on conditions in these ethnic areas, showing their poor conditions and crime.

A typical example of an ethnic quarter was the Lower East Side of Manhattan, which between the late 1800s and early 1900s was inhabited mostly by Italians and Jews. “Boarding,” the practice of renting parts of an apartment or subletting a bed to a relative or a fellow townsperson arrived from Italy, was widely common. As noted by Donna Gabaccia in her study of Sicilians located in Elizabeth Street in the Lower East Side, this practice—unknown on the home island—profoundly changed customs of patriarchal Sicilian families, which placed great importance on the control of the morality of wives and daughters.

The geographic fragmentation that characterized the majority of Little Italies reflected a clash between different local identities imported from Italy. The bulk of Italian migrants were peasants with a loose sense of national identity, since the Italian state was perceived as an enemy that imposed military service or high taxes. People mostly relied on village's identities, reproduced in the United States in myriad small mutual-aid societies. These provided financial assistance in cases of sickness or death, and sponsored ethnic events such as balls and picnics. These associations often welcomed only Italians from the same regional origins, taking the names of places or saints, or well-known Italians, including Christopher Columbus or Giuseppe Garibaldi. John Andreozzi estimates that around 20,000 ethnic organizations were created by Italians in the United States from the 1830s until the end of the 20th century, the largest being the Order Sons of Italy in America.

The ethnic quarter re-created services vital for the existence of immigrants, including banks, shops, steamship agencies, and restaurants. In 1940, over 10,000 Italian grocery stores and 2,000 bakeries were operating in New York alone. In the Little Italies, the prominenti (ethnic leaders) often led the ethnic associations. They were middle-class individuals (teachers, office workers, notaries, or journalists) with a remarkable social status in the Italian communities, but some were even employed in criminal activities. However, they played an important role in mediating the immigrants’ transition to American society, encouraging it for reasons including electoral potential. The prominenti also worked to control the Italian ethnic press, a medium that circulated news on Italy, the United States, and the Italian American communities. Italians also had Catholic churches and reproduced their native religious festivals in their districts.

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