Placing the poor while keeping the rich in their place: Separating strategies for optimally managing residential mobility and assimilation

Demographic Research. 2005;13:1

 

Journal Homepage

Journal Title: Demographic Research

ISSN: 1435-9871 (Print)

Publisher: Max Planck Institute for Demographic Research

Society/Institution: Max Planck Society

LCC Subject Category: Social Sciences: Economic theory. Demography: Demography. Population. Vital events

Country of publisher: Germany

Language of fulltext: English

Full-text formats available: PDF

 

AUTHORS


Gustav Feichtinger

Dieter Grass

Michael Johnson

Gernot Tragler

Yuri Yegorov

Jonathan P. Caulkins

EDITORIAL INFORMATION

Double blind peer review

Editorial Board

Instructions for authors

Time From Submission to Publication: 28 weeks

 

Abstract | Full Text

A central objective of modern US housing policy is deconcentrating poverty through "housing mobility programs" that move poor families into middle class neighborhoods. Pursuing these policies too aggressively risks inducing middle class flight, but being too cautious squanders the opportunity to help more poor families. This paper presents a stylized dynamicoptimization model that captures this tension. With base-caseparameter values, cost considerations limit mobility programs before flight becomes excessive. However, for modest departures reflecting stronger flight tendencies and/or weaker destination neighborhoods, other outcomes emerge. In particular, we find state-dependence and multiple equilibria, including both de-populated and oversized outcomes. For certain sets of parameters there exists a Skiba point that separates initial conditions for which the optimal strategy leads to substantial flight and depopulation from those for which the optimal strategy retains or even expands the middle class population. These results suggest the value of estimating middle-class neighborhoods' "carrying capacity" for absorbing mobility program placements and further modeling of dynamic response.