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Politics

What Urban Activists Get Wrong About Gentrification

Anti-gentrification banner displayed at the traditional workers May Day rally and march in Chicago, Illinois on May 1, 2018. Photo by Charles Edward Miller, flickr.com CC BY-SA 2.0.

Conventional wisdom has long dictated that gentrification is bad for low-income Americans. Progressives especially have decried the influx of higher-income residents into impoverished areas, saying they displace renters and homeowners, jeopardize work practices, disrupt family life, and undermine cultural connections.

But these alleged evils are not backed by evidence or even common sense. And while many rigorous studies have challenged the notion that gentrification displaces original low-income residents, anti-gentrification activism remains a powerful force in urban politics. Witness Amazon’s forced retreat from New York City.

Now, the facts are seeming to turn this “wisdom” on its head. A recent working paper from the Philadelphia Fed authored by researchers Quentin Brummet and Davin Reed demonstrates that gentrification not only benefits original residents, but also gives their children a better chance of rising out of poverty.

Using data from the 2000 Census and the 2010–2014 American Community Survey, they compared gentrifying and non-gentrifying neighborhoods in 100 of the largest US metropolitan areas. Drawing conclusions similar to previous studies, they found that gentrification — defined here as the increasing share of college-educated residents — only slightly raises the exit rate of original residents. Crucially, those who opted to leave were not substantially worse off in terms of employment outcomes or commuting distances.

The study revealed that gentrification comes with a large decrease in aggregate neighborhood poverty rates and significant increases in employment rates, median income, and home values. At the same time, gentrification did not generate steep rent increases for less-educated incumbents. Because median rental price figures often hide market segmentation, some home prices in gentrifying areas can increase drastically while a significant portion retain the same rents.

Possibly most importantly, gentrification was found to have immense benefits for the incumbents’ children. For these children, neighborhood improvements have already been shown to have significant impacts. We know from research carried out by Raj Chetty that neighborhood amenities and socioeconomic diversity are strong predictors of upward mobility. Lower-poverty neighborhoods have been shown to improve educational attainment rates and boost later career earnings for impoverished children. These children are themselves less likely to go on to become single parents, creating a virtuous cycle that helps the next generation.

Now, Brummet and Reed have found that gentrification reduces children’s exposure to neighborhood poverty while boosting neighborhood education and employment rates. This, in turn, increases the chance of disadvantaged children attending and completing college. Over time, gentrification seems to bring greater economic prosperity and opportunity to America’s poor children, giving them access to the resources and tools needed for success.

By reducing exposure to concentrated poverty and increasing exposure to employed adults and stable families, children in these neighborhoods have a greater chance of leading successful adult lives. So the next time you hear someone lamenting the changing urban environment and the surging number of college graduates in formerly-gritty neighborhoods, just remember that the presence of those newcomers improves outcomes for poor children.

From American Enterprise Institute, by Robert Doar

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Elena Tellez

I give credit to the middle- and upper-middle class people who are willing to move into poverty-stricken, often dirty, often dangerous urban areas in an effort to gentrify them. They are better people than I am. I would seek to avoid those problems. But young people can learn by example… and if seeing more successful people can encourage and inspire poor children of any race to have higher goals and dreams for themselves that they can work toward — that’s great. The Democrats’ programs which throw money at these inner city messes and schools haven’t worked… the people who live there need to get themselves educated… learn a trade… go to work… and improve themselves. They can build pride that way. Government handouts are belittling and keep the poor on the plantation. Just my two cents.

David Wynne

The conclusion is a rather broad brush that over emphasizes the importance of a college education. It also fails to define an economically impoverished area. Rural areas like mine, have always had lower average incomes than metropolitan areas. By many standards we are economically impoverished but our quality of life is (was) excellent. Our crime rate is very low, we have real communities where people care for and take care of each other. The last several years has seen an influx of higher income retired people fleeing the cities. The result is an increased need for skilled workers to service the wealthy newcomers. Carpenters, electricians, home care givers, truck drivers, and the like are in great demand. Problem is, is that rents have gone through the roof. The scarcity of affordable housing is a major problem. Workers have to live 40 to 50 miles away where housing is more available.… Read more »

Peter

As for me I was told GET OUT OR COMMIT SUICIDE. I was in therapy for many years because of this issue.. Now retired, homeless, and in just a position to hit you/them where it hurts.. THEIR CONSCIENCE…

Skeptic Al

Bustin’ up my ghetto..?