Parental involvement and neighborhood quality: evidence from public housing demolitions in Chicago

I study how parental involvement responds to declines in neighborhood quality. Previous research on this topic has largely been limited to current/former public housing residents. In contrast, I examine a population that has not selected into public housing. I utilize the mass closure and demolition of public housing projects in Chicago, but I focus on the spillover effects on neighborhoods receiving relocations. In the short run, parents in receiving neighborhoods respond by increasing parental involvement. Over a longer time horizon, these effects fade out as parents move out of the affected neighborhood. I use these responses to quantify the causal effect of declining neighborhood quality on parental involvement. To address neighborhood selection, I derive an instrumental variable for neighborhood quality based on the predicted impact of public housing closures on the family’s neighborhood. I find that, on average, parents compensate for decreased neighborhood quality by increasing parental involvement. Without accounting for parental responses, estimates of neighborhood effects are likely to understate the direct impact of neighborhood environment on children. The overall increase in parental involvement is mainly driven by parent-child interaction. Non-parenting household activity does not respond to changing neighborhood quality. Finally, there is evidence of heterogeneous neighborhood quality effects: most notably, parents with low initial involvement decrease parental involvement even more when neighborhood quality decreases. This pattern of heterogenous responses is not replicated for standard measures of socioeconomic advantage.