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

Author

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  • 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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    References listed on IDEAS

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    Cited by:

    1. Carlsson, Magnus & Abrar Reshid, Abdulaziz & Rooth, Dan-Olof, 2018. "Neighborhood Signaling Effects, Commuting Time, and Employment: Evidence from a Field Experiment," IZA Discussion Papers 11284, Institute of Labor Economics (IZA).
    2. Claire Dujardin & Florence Goffette-Nagot, 2005. "Neighborhood effects, public housing and unemployment in France," Post-Print halshs-00180046, HAL.
    3. Eleonore M Veldhuizen & Karien Stronks & Anton E Kunst, 2013. "Assessing Associations between Socio-Economic Environment and Self-Reported Health in Amsterdam Using Bespoke Environments," PLOS ONE, Public Library of Science, vol. 8(7), pages 1-10, July.
    4. van Ham, Maarten & Manley, David, 2013. "Occupational Mobility and Living in Deprived Neighbourhoods: Housing Tenure Differences in 'Neighbourhood Effects'," IZA Discussion Papers 7815, Institute of Labor Economics (IZA).
    5. Stephen Gibbons & Olmo Silva & Felix Weinhardt, 2013. "Everybody Needs Good Neighbours? Evidence from Students’ Outcomes in England," Economic Journal, Royal Economic Society, vol. 123, pages 831-874, September.
    6. Andrew E. Clark & Nicolai Kristensen & Niels Westergård-Nielsen, 2009. "Economic Satisfaction and Income Rank in Small Neighbourhoods," Journal of the European Economic Association, MIT Press, vol. 7(2-3), pages 519-527, 04-05.
    7. Dujardin, Claire & Goffette-Nagot, Florence, 2010. "Neighborhood effects on unemployment?: A test à la Altonji," Regional Science and Urban Economics, Elsevier, vol. 40(6), pages 380-396, November.
    8. Malone, Thom, 2020. "There goes the neighborhood does tipping exist amongst income groups?," Journal of Housing Economics, Elsevier, vol. 48(C).
    9. Petrović, Ana & Manley, David & van Ham, Maarten, 2018. "Freedom from the Tyranny of Neighbourhood: Rethinking Socio-Spatial Context Effects," IZA Discussion Papers 11416, Institute of Labor Economics (IZA).
    10. Lina Hedman & David Manley & Maarten van Ham & John Östh, 2015. "Cumulative exposure to disadvantage and the intergenerational transmission of neighbourhood effects," Journal of Economic Geography, Oxford University Press, vol. 15(1), pages 195-215.
    11. van Ham, Maarten & Boschman, Sanne & Vogel, Matt, 2017. "Incorporating Neighbourhood Choice in a Model of Neighbourhood Effects on Income," IZA Discussion Papers 10694, Institute of Labor Economics (IZA).
    12. Fenne M. Pinkster, 2014. "Neighbourhood Effects as Indirect Effects: Evidence from a Dutch Case Study on the Significance of Neighbourhood for Employment Trajectories," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 38(6), pages 2042-2059, November.
    13. David Manley & Maarten van Ham, 2011. "Living in deprived neighbourhoods in Scotland. Occupational mobility and neighbourhood effects," ERSA conference papers ersa10p547, European Regional Science Association.
    14. Vassilis Tselios & Inge Noback & Jouke Dijk & Philip McCann, 2015. "Integration Of Immigrants, Bridging Social Capital, Ethnicity, And Locality," Journal of Regional Science, Wiley Blackwell, vol. 55(3), pages 416-441, June.
    15. van Ham, Maarten & Manley, David, 2009. "The Effect of Neighbourhood Housing Tenure Mix on Labour Market Outcomes: A Longitudinal Perspective," IZA Discussion Papers 4094, Institute of Labor Economics (IZA).
    16. Catia Nicodemo & Gustavo Adolfo García, 2015. "Job Search Channels, Neighborhood Effects, and Wages Inequality in Developing Countries: The Colombian Case," The Developing Economies, Institute of Developing Economies, vol. 53(2), pages 75-99, June.
    17. Anna Piil Damm & Marie Louise Schultz-Nielsen, 2008. "The Construction of Neighbourhoods and its Relevance for the Measurement of Social and Ethnic Segregation: Evidence from Denmark," CReAM Discussion Paper Series 0810, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
    18. Maarten Ham & Sanne Boschman & Matt Vogel, 2018. "Incorporating Neighborhood Choice in a Model of Neighborhood Effects on Income," Demography, Springer;Population Association of America (PAA), vol. 55(3), pages 1069-1090, June.
    19. Cheshire, Paul, 2009. "Policies for mixed communities: faith-based displacement activity?," LSE Research Online Documents on Economics 30783, London School of Economics and Political Science, LSE Library.
    20. Maarten van Ham & David Manley, 2012. "Neighbourhood Effects Research at a Crossroads: Ten Challenges for Future Research," RatSWD Working Papers 204, German Data Forum (RatSWD).
    21. Zwiers, Merle & Bolt, Gideon & van Ham, Maarten & van Kempen, Ronald, 2014. "Neighborhood Decline and the Economic Crisis," IZA Discussion Papers 8749, Institute of Labor Economics (IZA).
    22. ., 2014. "Urban policies," Chapters, in: Urban Economics and Urban Policy, chapter 8, pages 185-218, Edward Elgar Publishing.

    More about this item

    Keywords

    neighbourhood effects; income dynamics; small scale neighbourhoods;

    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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