Abstract The industrial structure of Oslo has changed dramatically over the last fifty years. Much of the change took place in the 1980s and 1990s, and led to increasing income inequality. The latest decade has seen a different development: stable income inequality and increasing economic segregation. This pattern implies that long-term effects of structural economic change fuse with influences of a shorter temporal length. The net result of many changes, including immigration, is geographical polarisation: increasing segregation of both poor and affluent groups. It is a ‘contingent outcome’, and not a simple reflection of economic transformation and globalisation.