Working Paper: NBER ID: w31480
Authors: Fernando V. Ferreira; Jeanna H. Kenney; Benjamin Smith
Abstract: We study how recent gentrification shocks impact Black and Hispanic neighborhoods, including where minority households move to after a shock and if the subsequent spatial distribution of households within a labor market area affects segregation. We first report that household moves from a given neighborhood are concentrated to a few destinations. For minority neighborhoods, destinations tend to have similar minority shares but are farther away from downtown. Those mobility patterns are partially explained by neighborhood networks. We then use Bartik-style labor market income shocks to show that gentrification has many effects. In Black neighborhoods, gentrification increases house prices and reduces the share of Black households while increasing the share of White households. For movers from Black neighborhoods, gentrification increases the share of movers going to top 1 and 2 destinations based on neighborhood networks and increases the share of households moving out of the MSA, but does not change the pattern of households moving to neighborhoods with similar Black shares that are farther away from downtown areas. Hispanic neighborhoods have negligible effects from gentrification. Finally, our model reveals that overall labor market area segregation decreases after a gentrification shock because highly Black neighborhoods become less segregated.
Keywords: gentrification; household mobility; segregation; minority neighborhoods
JEL Codes: J61; R0
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| gentrification shocks (R23) | house prices (R31) |
| gentrification shocks (R23) | share of black residents (R23) |
| gentrification shocks (R23) | share of white residents (R23) |
| gentrification shocks (R23) | households moving to top 1 and 2 most connected neighborhoods (R23) |
| gentrification shocks (R23) | households moving out of the MSA (R23) |
| gentrification shocks (R23) | characteristics of destination neighborhoods (R23) |
| gentrification shocks (R23) | house prices in Hispanic neighborhoods (R21) |
| gentrification shocks (R23) | demographic shares in Hispanic neighborhoods (R23) |