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The Effect of Neighborhood Characteristics on Young Adult Outcomes: Alternative Estimates

  • R. D. Plotnick
  • S. D. Hoffman

We estimate a set of alternative models to examine the effect of neighborhood characteristics on outcomes among young adult women. The models are motivated by a concern that standard estimates of neighborhood effects may in part reflect the characteristics of families that reside in those neighborhoods. In addition to a "standard" model that includes controls for family background, we estimate fixed-effect models that also control for unobservable family characteristics that may affect young adult outcomes. To do this, we use a sample of sisters drawn from the Panel Study of Income Dynamics. In models that control for family background, we find evidence of neighborhood effects consistent with other recent work. In the fixed-effect models, however, there are no statistically significant effects that are consistent with standard hypotheses about neighborhood effects. The findings from this exploratory study suggest that one should be cautious about accepting findings of significant neighborhood effects derived from models that do not account for the possible selection of neighborhood.

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Paper provided by University of Wisconsin Institute for Research on Poverty in its series Institute for Research on Poverty Discussion Papers with number 1106-96.

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Handle: RePEc:wop:wispod:1106-96
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  1. Daniel Aaronson, . "Using Sibling Data to Estimate the Impact of Neighborhoods on Children's Educational Outcomes," IPR working papers 95-20, Institute for Policy Resarch at Northwestern University.
  2. 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.
  3. Griliches, Zvi, 1979. "Sibling Models and Data in Economics: Beginnings of a Survey," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages S37-64, October.
  4. Mary Corcoran & Roger Gordon & Deborah Laren & Gary Solon, 1992. "The Association between Men's Economic Status and Their Family and Community Origins," Journal of Human Resources, University of Wisconsin Press, vol. 27(4), pages 575-601.
  5. Geronimus, Arline T & Korenman, Sanders, 1992. "The Socioeconomic Consequences of Teen Childbearing Reconsidered," The Quarterly Journal of Economics, MIT Press, vol. 107(4), pages 1187-214, November.
  6. Chamberlain, Gary, 1980. "Analysis of Covariance with Qualitative Data," Review of Economic Studies, Wiley Blackwell, vol. 47(1), pages 225-38, January.
  7. Alan Krueger & Orley Ashenfelter, 1992. "Estimates of the Economic Return to Schooling from a New Sample of Twins," NBER Working Papers 4143, National Bureau of Economic Research, Inc.
  8. Donna Ginther & Robert Haveman & Barbara Wolfe, 2000. "Neighborhood Attributes as Determinants of Children's Outcomes: How Robust Are the Relationships?," Journal of Human Resources, University of Wisconsin Press, vol. 35(4), pages 603-642.
  9. G. S. Maddala, 1987. "Limited Dependent Variable Models Using Panel Data," Journal of Human Resources, University of Wisconsin Press, vol. 22(3), pages 307-338.
  10. 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.
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