Monday, April 10, 2017

Place And Economic Mobility

http://www.citylab.com



Leaking hydrant in front of two vacant houses
Detroit, Michigan
Photograph by Rebecca Cook/Reuters
citylab.com
Hello Everyone:

It is a sparkling beginning to another week.  For those of you celebrating: Happy Passover.  New week, new subjects to talk about.

Allow Blogger to start with a question: does where you influence you economic mobility? This is the question Richard Florida considers in his CityLab article "The Persistent Inequality of Neighborhoods."  The growing economic inequality, in the United States, has been blamed for "...everything from crony capitalism to the displacement of once good-paying job by globalization and new technology."  However according to a significant recent study, the real cause of  the growing schism between rich and poor is linked to the neighborhoods in which we born and raised.

South Bronx, New York
wnyc.org
The new study expands on the vital ongoing work of Harvard sociologist Robert J. Sampson and incorporated a larger economic mobility report, Economic Mobility, Research & Ideas on Strengthening Families, Communities & Economy (http://www.stlouisfed.org; date accessed Apr. 10, 2017), published by the St. Louis Federal Reserve Bank.  The study looks at "the rise of neighborhood inequality and its effects on the economic mobility of Americans.  The study asks two basic questions: 'How mobile are neighborhoods?' and 'How mobile are individuals across neighborhood income types?'"  The study uses Census date for neighborhoods throughout the U.S. between 1990 and 2012, and more detailed information from the 2014 Mixed-Income Project (http://www.projects.iq.harvard.edu: date accessed Apr. 10, 2017) to trace the effects of neighborhood locations on the mobility of people living in two of the largest American cities: Chicago and Los Angeles.

Richard Florida reports: "The study examines and compares two key measures of neighborhood income status-median family income and the 'degree of mutual exposure of lower- and higher-income persons'- for Census tracts or neighborhoods in these two cities."

South Memphis, Tennessee neighborhood
Photograph by Andrea Morales
placesjournal.org
Neighborhood poverty is persistent over time

The first fact you need to know and understand is "neighborhood poverty is stubbornly persistent across time."  How persistent is poverty across time?  Across the U.S. about "80 percent of poor neighborhoods in 1990 remained so in 2000, and 75 percent of poor neighborhood in 2000 remained so in 2012."  In the study cities, just about no neighborhoods moved from the bottom fifth to the upper fifth of the the income distribution scale.  Mr. Florida writes, "Just 5 percent of Chicago's high-poverty neighborhoods managed to improve to the top two quintile, and a mere 2 percent of L.A. neighborhood did so."  The grim reality of the situation is that poverty is so persistent and neighborhoods at the very bottom of the economic food chain operate, some degree, as poverty traps.

Chicago skyline
richard-seaman.com
Conversely, there is a persistence of affluence at the top of economic food chain.  Mr. Florida writes, "Very few affluent neighborhoods fell markedly down the economic strata.  Across the United States, 80 percent of affluent neighborhoods in 1990 remained affluent two decades later.  In Los Angeles 87 percent of affluent neighborhoods in 2000 remained so in 2010.  In Chicago that figure was 77 percent."

Interestingly, Professor Sampson found little evidence to support the claim that gentrification made a dent on persistent poverty-"less than three percent of U.S. neighborhoods in the bottom two income categories during the 1990s and 2000s moved above the 60th percentile."  Further, "a relatively small amount (50,000 neighborhoods) climbed from the bottom level to the top."

Prof. Sampson wrote:

...These findings militate against that income inequality is somehow recent at the neighborhood level or that neighborhoods have radically repositioned themselves.  Just as individual income mobility has been fairly low for some time, the odds of neighborhood-level upgrading are relatively low, and persistent neighborhood inequality has existed for decades....  (http://www.projects.iq.harvard.edu)

Los Angeles skyline
ucrtoday.ucr.edu
The gist of this is that the U.S. "suffers from a neighborhood inequality of 'concentrated extremes' that persist over long periods of time."  In both Chicago and Los Angeles, "90 percent of individuals who get up in an affluent neighborhood stayed at or near the top   and fewer than 10 percent of those who started in poor neighborhoods were able to climb to these affluent places."

This is true regardless of the deep changes in the economy and society throughout the Great Recession, growing inequality, and a significant drop-off in urban crime.  Prof Sampson wrote

...The facts on individual income mobility are crucial, of course, but they tell only half the story...The other half pertains to the prospects of change in one's community of residence: Individuals are born into, grow up, and become adults in neighborhoods that are also highly unequal....(Ibid)

Side-by-side comparison of affluent and low-income neighborhoods
Photograph by Oscar Ruíz
worthytales.net

On the positive side, Prof. Sampson found evidence of limited mobility or "fluidity" among middle class neighborhoods.  Here, both Chicago and L.A. outpaced the national average.  Specifically, "...37 percent of Chicago's neighborhoods and 47 percent of L.A.'s remained in the middle-income group over the span of two decades."  However, "...middle-income neighborhoods have become increasingly vulnerable over time and that the once vibrant middle of America's neighborhood geography has essentially hollowed out."  In short, the juxtaposition of neighborhood inequality is defined by side-by-side concentrations of disadvantage an concentrate advantage at the extremes, and the increasing precariousness of the middle.

"The cost of inequality"
news.harvard.edu
Race shapes economic advantages and penalties in neighborhoods, even when controlling for key factors

Race plays a very significant part in neighborhood inequality, according to Prof. Sampson's research.  Regardless of predictions of  the decreasing role of race and the increase of a post-racial society, Prof. Sampson also concluded "...neighborhood poverty and inequality to be inextricably linked to race."  Probing this further, he examined  the "...relationship between neighborhood income and race/ethnicity over time, controlling for factors such as immigrant generation, education, education, employment, family income, household size, home ownership, and martial status."  Prof. Sampson revealed a "clear economic advantage for white neighborhoods and an economic penalty for black neighborhoods."

Chicago African-Americans were found to have a nearly $19,000 lower median income than Caucasian, $8,000 less in Los Angeles, after taking baseline neighborhood incomes into account.  Prof. Sampson points outs,

...white privilege in neighborhood status is maintained after controlling for the classic mobility-relate features of individual background, residential mobility and the macro effects of the Great Recession...  (Ibid)

African-American neighborhoods are more effected, than Caucasian neighborhoods, to greater poverty, more unemployment, and greater crime an isomer.  In short,

...racial inequality in exposure to low-income neighborhood environments is so strong that high-income blacks are exposed to greater neighborhood poverty  than low-income whites...  (Ibid)

Map of Concentrated Poverty in Baltimore
cityobservatory.org
Poverty policies can be "people-orientated" and "place-oriented"

Professor Robert J. Sampson also focused on what solutions can be found to combat America's neighborhood inequality.  Richard Florida reports, "He divides our current approach to poverty into tow main buckets.  One the one side are 'people-oriented' policies, favored by many economists, that aim to move people, particularly young people, out of disadvantaged places and relocate them to neighborhoods with better schools and services."  A recent study, The Effects of Exposure to Better Neighborhoods on Children: New Evidence from the Moving to Opportunity Experiment (http://www.scholar.harvard.edu), concluded that "people-oriented strategies can work: The children of families who used vouchers to move from higher to lower poverty neighborhoods had higher adult earning, though this effect was much greater for children who moved at a very young age."  The flip side, "place-oriented" policies that aim to fortify neighborhoods; improve them and make them stronger.

Minneapolis, Minnesota-area neighborhood
tcdailyplanet.net
 Prof. Sampson makes the argument, which Richard Florida agrees with, that we need to employ both solutions.  Expansion of people-oriented solutions, in the short-term, "would allow talented kids to avoid the negative effects of their old neighborhoods."  The long-term approach "would be more substantial investments to improve disadvantage neighborhoods.  Prof. Sampson points out:

What poor residents seem to want most is not move but simply to have their communities revitalized.

To make this simple wish come true, Prof. Sampson "argues in favor of what NYU's Patrick Sharkey has dubbed 'durable investments in neighborhoods-large-sacle interventions in education, health, employment, crime-reduction, community social services, and the whole gamut of strategies required to combat the long legacy of persistent disadvantages in these places."  Blogger concurs with this approach.  Prof. Sampson makes a particularly effective case for what he refers to affirmative action for neighborhoods, involving cash assistance or reduced tax rates for residents in low-income or historically disadvantaged areas.

The United States has always been "the land of opportunity" but that opportunity has not always been equal for quite a while, if at all.  The middle has hollowed of our cities, inequality is firmly engrained into our increasing divided map.  Prof. Robert J. Sampson concludes,

The salience of neighborhood difference has persisted across long times scales and historical eras...spatial arrangements constitute a fundamental organizing dimension of social inequality.  Essentially, place determines our economic mobility.