One way to reduce income inequality is to strengthen social policies that promote social and economic mobility says Reardon.
By Mike Sitkowski
Sean Reardon and Kendra Bischoff of Stanford University released a report
in November 2011 entitled “More Unequal and More Separate: Growth in
the Residential Segregation of Families by Income, 1970-2009.” The
report details the trend of increasing segregation by income in American
metropolitan areas, finding that “the share of the population in large
and moderate-sized metropolitan areas who live in the poorest and most
affluent neighborhoods has more than doubled since 1970, while the share
of families living in middle-income neighborhoods dropped from 65
percent to 44 percent.” You can find a CPR review of their report here.
What surprised you most about the results of your study?
The most surprising result for us was the doubling, from 1970 to
2007, of the percentage of families living in poor or affluent
neighborhoods.
Do you think income segregation trends will continue to increase over the next decade?
First, it is unclear how the housing crisis and recession have
affected income segregation over the last few years. The most recent
data available in our report were from the period 2005-2009; most of
that time period is pre-housing crisis and recession. As a result, our
data don’t tell us how income segregation has changed more recently. Job
loss and housing foreclosures—both of which became much more prevalent
since 2008—affect both family income and where people live, and so will
affect income segregation. Housing foreclosures may have increased
income segregation by causing low-income families to move to
lower-income neighborhoods. Conversely, declining income among some
middle-income families, either as a result of declining real wages or
unemployment, may have led to a reduction in income segregation if those
families remained in their neighborhoods but experienced a decline in
income relative to their neighbors.
Second, future trends in income segregation are hard to predict from
our current vantage point, though if income inequality remains as high
as it is now or continues to grow, we suspect income segregation will
continue to grow. To significantly reverse the ongoing trend of
increasing income segregation, the United States would not only need to
reduce income inequality, but it would also have to rethink housing and
residential zoning policies.
In your report, you discuss the effects of income segregation
on children. Can you discuss the long-term consequences you anticipate
for children raised in neighborhoods with high income segregation?
The concern we have is that within metropolitan areas, as income is
increasingly unequally distributed among neighborhoods and communities
so too is the quality of public resources, such as schools. Schools are a
focal point because education is important for upward mobility, and
schools are also where children spend a great deal of their time. Thus,
equality of educational opportunity is important both for equality of
outcomes as well as for children’s quality of life. In addition to the
actual access to resources, such as schools, green space, and clean air,
we are also concerned that the increasing separation of affluent and
poor families leads to less interaction between people of different
social classes. This could lead to more polarization of political
beliefs, as well as less support among the affluent for
equality-generating social policies.
What do these trends in income segregation bode for the
future of American cities? In what major ways will cities change if
income segregation continues to increase?
We
have already witnessed changes in American metropolitan areas as a
result of the large increases in income segregation over the past 40
years. Our research focuses on metropolitan areas, which are
generally considered to be proxies for labor markets and consist of a
central city and its surrounding suburbs. Within metropolitan areas we
have observed increasing macro-segregation, or large-scale separation of
wealthy families from families of all other income levels. Metropolitan
areas like Philadelphia and Detroit have experienced a hollowing out of
their inner cities and a growth in high income enclaves in suburban and
exurban communities.
However, there have also been changes in micro-segregation within
inner cities, meaning that there are more pockets of poverty and wealth
within central cities. Of course this has always been true to some
extent, but it is becoming more prevalent which means that fewer
families are living in mixed-income neighborhoods.
What, if anything, can cities do to combat the effects of income inequality?
There are many possible effects of income inequality, including
health disparities, crime, education gaps, political polarization, as
well as income segregation. Thus, there are policies that can act to
reduce income inequality itself, and there are policies that try to
reduce the harm done by income inequality. Given the limits of sub-state
government, there is little that cities can do to change the overall
income distribution. Metropolitan areas, which consist of multiple
municipalities and other political jurisdictions, can however, implement
revenue-sharing plans that help to equalize the tax base across their
jurisdictions, thereby increasing regional equality. A select few
metropolitan areas have implemented this type of plan, such as
Minneapolis-St, Paul, MN.
In terms of combating income segregation, one of the effects of
income inequality, cities can alter housing policies, zoning
restrictions, and other laws that have consequences for where people
live. Cities might also combat the negative effects of income
segregation by changing school assignment policies to better integrate
schools by race and class, for example, or by providing more amenities,
such as well-kept public parks, in disadvantaged areas.
What, if anything, can the federal government do to combat the effects of income inequality?
Income inequality is now at historically high levels in the US, and
is higher in the US than in most other developed countries. One way to
combat the negative effects of such income inequality would be to work
to reduce inequality by supporting industries that create well-paying
jobs, by modifying the tax code, by raising the minimum wage, and by
strengthening the social safety net to support families through the hard
times between jobs and when workers are sick or disabled.
Another way to combat the effects of income inequality is to
strengthen social policies that promote social and economic mobility, so
that those who grow up poor have a greater opportunity to achieve
middle-class success. Policies that increase the availability of
high-quality child care and pre-school for low-income families, for
example, may lead to greater social mobility (less intergeneration
reproduction of inequality) by providing children from low-income
families with greater opportunities for educational and economic
success.
A third way to combat the effects of income inequality is to revise
campaign finance law so that economic resources do not play such a large
role in elections. A more balanced democratic process—one where the
wealth of one’s constituents did not play such a large role in
elections—might yield policy changes that lead to greater equality of
opportunity and a fairer, more democratic society.