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Neighbourhoods, Households and Income Dynamics: A Semi-Parametric Investigation of Neighbourhood Effects

Author

Listed:
  • Anne Bolster
  • Simon Burgess
  • Ron Johnston
  • Kelvyn Jones
  • Carol Propper
  • Rebecca Sarker

Abstract

Using a unique dataset, we present evidence on income trajectories of people living in micro neighbourhoods. We place bounds on the influence of neighbourhood making as few parametric assumptions as possible. The paper offers a number of advances. We exploit a dataset that is large, representative, longitudinal with very local neighbourhoods. We analyse income growth over one, five- and ten-year windows. We analyse the whole distribution of income growth and track large gainers and losers as well as average outcomes. We consider the appropriate definition of neighbourhood. We find little evidence of a negative relationship between neighbourhood and subsequent income growth.

Suggested Citation

  • Anne Bolster & Simon Burgess & Ron Johnston & Kelvyn Jones & Carol Propper & Rebecca Sarker, 2004. "Neighbourhoods, Households and Income Dynamics: A Semi-Parametric Investigation of Neighbourhood Effects," The Centre for Market and Public Organisation 04/106, The Centre for Market and Public Organisation, University of Bristol, UK.
    • Handle: RePEc:bri:cmpowp:04/106
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    File URL: http://www.bris.ac.uk/Depts/CMPO/workingpapers/wp106.pdf
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    References listed on IDEAS

    as
    1. Brock, William A. & Durlauf, Steven N., 2001. "Interactions-based models," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 54, pages 3297-3380, Elsevier.
    2. Jens Ludwig & Greg J. Duncan & Paul Hirschfield, 2001. "Urban Poverty and Juvenile Crime: Evidence from a Randomized Housing-Mobility Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(2), pages 655-679.
    3. Charles F. Manski, 2000. "Economic Analysis of Social Interactions," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 115-136, Summer.
    4. Lawrence F. Katz & Jeffrey R. Kling & Jeffrey B. Liebman, 2001. "Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(2), pages 607-654.
    5. Charles F. Manski, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 60(3), pages 531-542.
    6. Brock,W.A. & Durlauf,S.N., 2003. "Multinomial choice with social interactions," Working papers 1, Wisconsin Madison - Social Systems.
    7. Andrew McCulloch, 2001. "Ward-Level Deprivation and Individual Social and Economic Outcomes in the British Household Panel Study," Environment and Planning A, , vol. 33(4), pages 667-684, April.
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    More about this item

    Keywords

    neighbourhood effects; income dynamics; small scale neighbourhoods;
    All these keywords.

    JEL classification:

    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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