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Assessing the evidence on neighborhood effects from moving to opportunity

  • Dionissi Aliprantis

This paper presents a new perspective on results from the Moving to Opportunity (MTO) housing mobility program. Building on recent developments in the program evaluation literature, this paper defines several treatment effect parameters and then estimates and interprets these parameters using data from MTO. The evaluation framework is used to make a clear distinction between the interpretation of Intent to Treat (ITT) and Treatment on the Treated (TOT) parameters as program effects and Local Average Treatment Effect (LATE) parameters as neighborhood effects. This distinction helps to clarify that results from MTO are only informative about a small subset of neighborhood effects of interest. Tests for instrument strength show that MTO induced large changes in neighborhood poverty rates. However, it is also shown that MTO induced remarkably little variation in many of the other neighborhood and school characteristics believed to influence outcomes and that much of this variation was confined to the tails of these characteristics' national distributions. Consistent with prevailing theories of neighborhood effects, labor market and health outcomes improved when households moved to neighborhoods with characteristics at or above the national median. The evidence suggests housing mobility programs designed to induce moves to neighborhoods with characteristics in addition to or in lieu of low poverty might induce larger effects than MTO, and results point to the investigation of heterogeneity in program effects from MTO as a fruitful direction for future research.

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Paper provided by Federal Reserve Bank of Cleveland in its series Working Paper with number 1122.

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Date of creation: 2011
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Handle: RePEc:fip:fedcwp:1122
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