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

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


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.

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Paper provided by Department of Economics, University of Bristol, UK in its series The Centre for Market and Public Organisation with number 04/106.

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Length: 53 pages
Date of creation: Aug 2004
Date of revision:
Handle: RePEc:bri:cmpowp:04/106
Contact details of provider: Postal: 2 Priory Road, Bristol, BS8 1TX
Phone: 0117 33 10799
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  1. William Brock & Steven N. Durlauf, 2000. "Interactions-Based Models," NBER Technical Working Papers 0258, National Bureau of Economic Research, Inc.
  2. Lawrence Katz & B. Jeffrey Liebman, 2000. "Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment," Working Papers 820, Princeton University, Department of Economics, Industrial Relations Section..
  3. Jens Otto Ludwig & Greg Duncan & Paul Hirschfield, 2000. "Urban Poverty and Juvenile Crime: Evidence from a Randomized Housing-Mobility Experiment," JCPR Working Papers 158, Northwestern University/University of Chicago Joint Center for Poverty Research.
  4. Manski, Charles F, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," Review of Economic Studies, Wiley Blackwell, vol. 60(3), pages 531-42, July.
  5. Charles F. Manski, 2000. "Economic Analysis of Social Interactions," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 115-136, Summer.
  6. Brock,W.A. & Durlauf,S.N., 2003. "Multinomial choice with social interactions," Working papers 1, Wisconsin Madison - Social Systems.
  7. 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.
  8. Andrew McCulloch, 2001. "Ward-level deprivation and individual social and economic outcomes in the British Household Panel Study," Environment and Planning A, Pion Ltd, London, vol. 33(4), pages 667-684, April.
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