Can the US use transport to improve social mobility?

The news has been teeming with a new economic buzzword: neighborhoods. Okay, it’s neither new nor unique to economic argot, but a recent study makes the case that good neighborhoods are a critical factor for economic mobility across generations.

In the mid-1990s, the U.S. Department of Housing and Urban Development offered subsidized housing vouchers to a randomly selected group of low-income public housing recipients, giving them an opportunity to move to lower-poverty neighborhoods. This federally sanctioned experiment, appropriately named Moving to Opportunity, provided a venue for economists and other social scientists to test whether poor adults and their children would do better in life if they lived in middle-class neighborhoods.

Early evaluations of the experiment, which ended in the mid-2000s, yielded disappointing results. But economists Raj Chetty, Nathaniel Hendren, and Lawrence Katz of Harvard University have revisited the outcomes of the Moving to Opportunity program ten years later and find that place really does matter.

No, this does not imply that HUD should scale up the Moving to Opportunity program or even distribute more subsidized housing vouchers, especially given that most U.S. cities have endlesspublic housing-voucher waitlists and vouchers only benefit a small proportion of those in need. Moving people away from their neighborhoods can also be disruptive to social ties and kinship networks that have persisted through generations.

So what about commuting to opportunity, instead?

Opportunities for employment do exist for lower-income families across cities, but it’s a challenge to actually reach these neighborhoods—a spatial mismatch of sorts. Over most of the post-War era, suburban sprawl was largely a white, middle-class phenomenon, though in recent decades more and more minorities have moved to the burbs, too. But intriguingly, in the years since 2000, the demographic composition of the suburbs began to change. Many of the jobs that were once in urban cores retreated to suburban neighborhoods. And as jobs suburbanized, so too did a large number of low-income people, especially low-income minority workers, seeking employment.

Unexpectedly, this outward shift of jobs also widened the distance between people and their potential employment opportunities, prolonging their job search and spells of joblessness. According to a new report by the Brookings Metropolitan Policy Program, the number of jobs within typical commuting distance of suburbanites fell by seven percent between 2000 and 2012, while the decline was less than half that for urban workers. These changes disproportionately affected poor and non-white residents. Public transportation in the suburbs is sparse, and low-income workers simply don’t have access to cars like their suburban, middle-class neighbors.

Job proximity is not the only challenge. As metropolitan areas continue to sprawl, sustaining efficient and inexpensive public transportation becomes even more complicated. In 2011, the Brookings Institution estimated that only 30 percent of metropolitan jobs were reachable within 90 minutes via public transit. By the same standards, only one fourth of low- and middle-skill industries are accessible using the existing commuting infrastructure.

Physical access to opportunity (and subsequently economic mobility) is no small problem. But despite these challenges, how can we improve existing infrastructure in communities and neighborhoods? How can we create good neighborhoods? Urban and Regional Planners just may have an answer: transit-oriented development.

Transit-oriented development is an urban planning and land development method that prioritizes creating mixed-use neighborhoods within a ten-minute walking radius of high-quality public transportation. One of the obvious benefits is reduced commuting time and transit costs for neighborhood residents. But an implicit advantage of transit-oriented communities is their mixed-use design.

Mixed-use generally refers to the diversity of amenities a neighborhood provides. Mixed-use communities could feature diverse types of housing, for example, so that low-income families could take advantage of the schools, medical clinics, retail, and recreation and green spaces—all within walking distance of public transportation so breadwinners could get to their jobs and their kids could get to school.

The idea is simple: by placing people closer to almost everything they need, we help reduce the resources they invest in trying to access it and offer new opportunities to move into middle-class neighborhoods.

There’s a valid concern, though, that developments near public transit areas can be a catalyst forgentrification because they may displace low-income families rather than lifting them up. But that’s why, like any good planning initiative, policymakers and urban and regional planners must employ equitable development techniques no matter where the transit-oriented neighborhoods are situated. By pairing transit-oriented development with measures such as inclusionary upzoning or mixed-income housing, access to opportunity and economic mobility can be more equitable.

This article is published in collaboration with Washington Center for Equitable Growth. Publication does not imply endorsement of views by the World Economic Forum.

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Author: Kavya Vaghul is a Research Analyst at the Washington Center for Equitable Growth.

Image:The 10/110 freeway interchange is seen in Los Angeles, California. REUTERS/Eric Thayer