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Neighborhood Effects on High-School Drop-Out Rates and Teenage Childbearing: Tests for Non-Linearities, Race-Specific Effects, Interactions with Family Characteristics, and Endogenous Causation using Geocoded California Census Microdata

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  • Rhiannon Patterson
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    Abstract

    This paper examines the relationship between neighborhood characteristics and the likelihood that a youth will drop out of high school or have a child during the teenage years. Using a dataset that is uniquely wellsuited to the study of neighborhood effects, the impact of the neighborhood poverty rate and the percentage of professionals in the local labor force on youth outcomes in California is examined. The first section of the paper tests for non-linearities in the relationship between indicators of neighborhood distress and youth outcomes. Some evidence is found for a break-point at low levels of poverty. Suggestive but inconclusive evidence is also found for a second breakpoint, at very high levels of poverty, for African-American youth only. The second part of the paper examines interactions between family background characteristics and neighborhood effects, and finds that White youth are most sensitive to neighborhood effects, while the effect of parental education depends on the neighborhood measure in question. Among White youth, those from single-parent households are more vulnerable to neighborhood conditions. The third section of the paper finds that for White youth and Hispanic youth, the relevant neighborhood variables appear to be the own-race poverty rates and the percentage of professionals of youths’ own race. The final section of the paper estimates a tract-fixed effects model, using the results from the third section to define multiple relevant poverty rates within each tract. The fixed-effects specification suggests that for White and Hispanic youth in California, neighborhood effects remain significant, even with the inclusion of controls for any unobserved family and neighborhood characteristics that are constant within tracts.

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    File URL: ftp://ftp2.census.gov/ces/wp/2008/CES-WP-08-12.pdf
    File Function: First version, 2008
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    Bibliographic Info

    Paper provided by Center for Economic Studies, U.S. Census Bureau in its series Working Papers with number 08-12.

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    Length: 64 pages
    Date of creation: May 2008
    Date of revision:
    Handle: RePEc:cen:wpaper:08-12

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    Related research

    Keywords: Entrepreneurship; Business Performance; Inner City Markets;

    References

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    1. R. D. Plotnick & S. D. Hoffman, . "The Effect of Neighborhood Characteristics on Young Adult Outcomes: Alternative Estimates," Institute for Research on Poverty Discussion Papers 1106-96, University of Wisconsin Institute for Research on Poverty.
    2. George J. Borjas, 1991. "Ethnic Capital and Intergenerational Mobility," NBER Working Papers 3788, National Bureau of Economic Research, Inc.
    3. Quigley, John M., 2002. "A Decent Home: Housing Policy in Perspective," Berkeley Program on Housing and Urban Policy, Working Paper Series qt8f57x42q, Berkeley Program on Housing and Urban Policy.
    4. Katherine M. O'Regan & John M. Quigley, 1996. "Spatial effects upon employment outcomes: the case of New Jersey teenagers," New England Economic Review, Federal Reserve Bank of Boston, issue May, pages 41-64.
    5. Daniel Aaronson, 1998. "Using Sibling Data to Estimate the Impact of Neighborhoods on Children's Educational Outcomes," Journal of Human Resources, University of Wisconsin Press, vol. 33(4), pages 915-946.
    6. White, Halbert, 1982. "Maximum Likelihood Estimation of Misspecified Models," Econometrica, Econometric Society, vol. 50(1), pages 1-25, January.
    7. Edward L. Glaeser & Bruce Sacerdote & Jose A. Scheinkman, 1995. "Crime and Social Interactions," NBER Working Papers 5026, National Bureau of Economic Research, Inc.
    8. Anne C. Case & Lawrence F. Katz, 1991. "The Company You Keep: The Effects of Family and Neighborhood on Disadvantaged Youths," NBER Working Papers 3705, National Bureau of Economic Research, Inc.
    9. George J. Borjas, 1994. "Ethnicity, Neighborhoods, and Human Capital Externalities," NBER Working Papers 4912, National Bureau of Economic Research, Inc.
    10. Paul A. Jargowsky, 1994. "Ghetto poverty among blacks in the 1980s," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 13(2), pages 288-310.
    11. Manski, C.F., 1991. "Identification of Endogenous Social Effects: the Reflection Problem," Working papers 9127, Wisconsin Madison - Social Systems.
    12. Cutler, David & Vigdor, Jacob & Glaeser, Edward, 1999. "The Rise and Decline of the American Ghetto," Scholarly Articles 2770033, Harvard University Department of Economics.
    13. Cutler, David M & Glaeser, Edward L, 1997. "Are Ghettos Good or Bad?," The Quarterly Journal of Economics, MIT Press, vol. 112(3), pages 827-72, August.
    14. Evans, William N & Oates, Wallace E & Schwab, Robert M, 1992. "Measuring Peer Group Effects: A Study of Teenage Behavior," Journal of Political Economy, University of Chicago Press, vol. 100(5), pages 966-91, October.
    15. Schelling, Thomas C, 1969. "Models of Segregation," American Economic Review, American Economic Association, vol. 59(2), pages 488-93, May.
    16. Gary Solon & Marianne E. Page & Greg J. Duncan, 2000. "Correlations Between Neighboring Children In Their Subsequent Educational Attainment," The Review of Economics and Statistics, MIT Press, vol. 82(3), pages 383-392, August.
    17. Evans, William N & Schwab, Robert M, 1995. "Finishing High School and Starting College: Do Catholic Schools Make a Difference?," The Quarterly Journal of Economics, MIT Press, vol. 110(4), pages 941-74, November.
    18. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
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    Cited by:
    1. Gregory Price, 2013. "Hurricane Katrina as an Experiment in Housing Mobility and Neighborhood Effects: Were the Relocated Poor Black Evacuees Better-Off?," The Review of Black Political Economy, Springer, vol. 40(2), pages 121-143, June.

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