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Planners Can Help Increase Opportunity and Fairness

Transportation and land use planning decisions affect economic opportunity and mobility—the chance that children become more economically successful than their parents. We can help create more equitable communities.
Todd Litman | July 24, 2019, 9am PDT
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Life is often unfair, but we can make it less so.

Children born in high poverty neighborhoods have fewer opportunities and tend to be less economically successful than children born in wealthier communities. New research helps identify ways to improve disadvantaged people's economic opportunities, and planners can play important roles in creating more equitable [pdf] communities. 

Professor Raj Chetty has led a growing body of research on factors that affect economic mobility: the chance that a child born in a low-income family will become more economically successful as an adult. This research indicates that children are much more successful if they grow up in some neighborhoods than in others. What are the key factors? This research suggests that concentrated poverty and institutionalized racism tend to reduce economic opportunity while compact and mixed communities with multimodal transportation systems tends to increase disadvantaged residents’ economic opportunity by improving access to education, employment and positive role models. This is particularly important [pdf] for physically and economically disadvantaged groups that lack a driver’s license or cars.

In their study, "Measuring Urban Sprawl and Validating Sprawl Measures" [pdf] building on Chetty's data, researchers Reid Ewing and Shima Hamidi found that each 10% increase in their Smart Growth index is associated with a 4.1% increase in residents’ upward mobility (probability of children born in the lowest income quintile reaching the top quintile by age 30). Subsequent analysis published in their article, "Does Urban Sprawl Hold Down Upward Mobility?" further demonstrated that Smart Growth policies can increase economic mobility; doubling their compactness index increases the probability that a child born to a family in the bottom income quintile will reach the top quintile by age 30 by about 41%.

Using different research methods, Eric Chyn's study, "Moved to Opportunity: The Long-Run Effect of Public Housing Demolition on Labor Market Outcomes of Children" [pdf], found that children who left concentrated poverty neighborhoods are 9% (4 percentage points) more likely to be employed as adults relative to their non-displaced peers, and have $602 higher average annual earnings – an 16% increase relative to their counterparts who remained in concentrated poverty. Chang-Tai Hsieh and Enrico Moretti analyzed the economic impacts of restrictions on development density in Boston, New York, Seattle, San Francisco and Washington, D.C. They estimate that allowing more affordable infill development in these highly productive cities would improve economic opportunity to economically disadvantaged workers as well as increase aggregate national economic output by 13% annually, equivalent to several thousand dollars per worker.

Living in a multimodal community, where it is easy to access common services and activities without a car, tends to increase economic opportunity. Emily Talen and Julia Koschinsky's Equality of Opportunity Project found strong correlations between neighborhood accessibility (based on WalkScores) and economic mobility. They found that a child born to the bottom fifth income group in a walkable neighborhood has a much better chance of becoming financially prosperous than a poor child born in a non-accessible area. In the recent study, "Commute Mode Diversity and Income Inequality: An Inter-Urban Analysis of 148 Midsize US Cities," Chad Frederick and John Hans Gilderbloom, found that increased commute mode diversity (smaller automobile mode shares) is associated with less income inequality between white and African-American households, and between men and women, and with higher earnings for white women and African-American men. 

An extensive body of research indicates that, all else being equal, Smart Growth policies that increase development density and walkability reduce crime rates. For example, Analysis of Urban Vibrancy and Safety in Philadelphia (Humphrey, et al. 2017), used fine-grained geographic data to measure the relationships between urban vibrancy (human activity in an area) and public safety in Philadelphia. They found that, controlling for other factors, crimes associated with commercial activities, such as store robberies and drunken assaults, increase in neighborhoods with more businesses, but crime rates decline on blocks where businesses are open for more hours per week, indicating that all else being equal, businesses suppress crime. Similarly, Danger Zone: Land Use and the Geography of Neighborhood Crime (Twinam 2018) used high-resolution data to evaluate the impacts that residential density and land use mix have on street crime (robbery and assault) in Chicago. The results indicate that crime rates increase near commercial land uses, particularly bars and liquor stores, but this effect is offset by population density; dense mixed-use areas are safer than typical residential areas.

Some studies, such as Michael J. Smart and Nicholas J. Klein's "Longitudinal Analysis of Cars, Transit, and Employment Outcomes" [pdf], indicate that economically disadvantaged workers (such as former welfare recipients) tend to work and earn more, and have better access to basic services such as medical care and shopping, if they have an automobile. This leads some people to conclude that increased vehicle ownership increases social equity, that vehicle subsidies (subsidized vehicles, low fuel prices, unpriced roads and parking, etc.) help achieve equity objectives, and efforts to reduce vehicle travel are regressive.

However, automobiles are costly. Low income motorists must typically spend $300 to $500 per month to own and operate a vehicle, including sometimes large unexpected expenses due to vehicle failures, accidents and traffic citations. Their insurance premiums tend to be high, and the older vehicles they own tend to be unreliable, imposing large repair costs. As a result, much of the additional income provided by automobile ownership must be spent on vehicles, reducing net gains. Smart and Klein's study found that after shifting from being carless to owning one car, a typical low-income family earned approximately $2,300 more but spent more than $4,100 annually to own and maintain that vehicle, so the incremental income was insufficient to pay the additional costs. Automobile travel also tends to increase users' accident risks and health problems [pdf], and increases external costs imposed on local communities including traffic congestion, road and parking facility costs, accident risk, and pollution emissions.

Other studies indicate that high quality public transit increases labor participation with lower total costs and risks. Shengyi Gao and Robert A. Johnston's study, "Public vs. Private Mobility for Low Income Households: Transit Improvements vs. Increased Car Ownership in the Sacramento Region," indicates that transit improvements provide greater total benefits to all income groups than subsidizing automobiles for lower-income groups.

Chetty's research has often been used to justify "moving to opportunity" [pdf] programs, through which lower-income households move to higher opportunity neighborhoods, which often means from central cities to suburbs. However, another approach that can provide greater total benefits is to improve affordable transportation options (walking, bicycling and public transit) and affordable housing options, and encourage more mixed-income development in existing urban neighborhoods. A recent study, The Effects of Gentrification on the Well-Being and Opportunity of Original Resident Adults and Children [pdf] by economists Quentin Brummet at the University of Chicago and Davin Reed of the Federal Reserve Bank, found that gentrification tends to reduce low-income neighborhoods' poverty rates, making most residents better off overall. Of course, it is important that planners work to minimize the costs and maximize the benefits of community changes with policies that support gentrification without displacement and protect minority community businesses and culture.

This is an important and timely issue. In traditional peasant economies, economic opportunity depended on poor households' access to productive farmlands, which is why rural land reform and revolution were so important to oppressed peoples. In a modern post-industrial economy, economic opportunity depends on households' access to urban education, jobs and services, sometimes called "the right to the city." Affordable urban housing is the functional way for disadvantaged people to participate in productive activities. However, unlike land reform, everybody wins when people who want to study, work and shop in a city are able to do so; those workers, their families, their employers, other businesses (from which they become customers), and the city itself. 

All this indicates that Smart Growth development policies and more multimodal transport planning help improve economic opportunity and fairness, in addition to other benefits. To achieve social justice goals we should ensure that any physically, economically or socially disadvantaged family, particularly those that have children or adolescent members, can find suitable housing in walkable urban neighborhoods, and have high quality, affordable mobility options including good walking, bicycling and public transit. It can also include targeted efforts to improve schools and recreational facilities in disadvantaged communities, and discounted transit fares for lower-income residents. I think that most planning practitioners have a general sense of these effects but not enough knowledge to justify major policy reforms for social equity sake.

What do you think? Can we do more to inform policy makers and the general public, and particularly advocates for disadvantaged groups, of the significant benefits to their community provided by Smart Growth development policies and multimodal transport planning?

For More Information

Mikayla Bouchard (2015), "Transportation Emerges as Crucial to Escaping Poverty," New York Times.

Eric Chyn (2016), Moved to Opportunity: The Long-Run Effect of Public Housing Demolition on Labor Market Outcomes of Children, Department of Economics, University of Michigan.

CTS (2010), How Light-Rail Transit Improves Job Access for Low-Wage Workers, Research Brief, Center for Transportation Studies, Univesity of Minnesota (www.cts.umn.edu).

Reid Ewing and Shima Hamidi (2014), Measuring Urban Sprawl and Validating Sprawl Measures, Metropolitan Research Center at the University of Utah for the National Cancer Institute.

Reid Ewing, et al. (2016), "Does Urban Sprawl Hold Down Upward Mobility?," Landscape and Urban Planning, Vol. 148, April, pp. 80-88.

Shengyi Gao and Robert A. Johnston (2009), "Public vs. Private Mobility for Low Income Households: Transit Improvements vs. Increased Car Ownership in the Sacramento Region," Transportation Research Record 2125, pp. 9-15.

Andrew Guthrie, et al. (2019), Those Who Need it Most: Maximizing Transit Accessibility and Removing Barriers to Employment in Areas of Concentrated Poverty, Univeristy of Minnesota. 

Chang-Tai Hsieh and Enrico Moretti (2017), Housing Constraints and Spatial Misallocation, University of California, Berkeley and the National Bureau of Economic Research.

Junfeng Jiao and Maxwell Dillivan (2013), "Transit Deserts: The Gap Between Demand and Supply," Journal of Public Transportation, Vol. 16, No. 3, pp. 23-35.

Elizabeth Kneebone and Natalie Holmes (2015), The Growing Distance Between People and Jobs in Metropolitan America, Brookings Institution.

Ugo Lachapelle, et al. (2011), "Commuting by Public Transit and Physical Activity: Where You Live, Where You Work, and How You Get There," Journal of Physical Activity and Health, Vol. 8/1, pp. S72-S82.

Diane K. Levy, Zach McDade and Kassie Dumlao (2010), Effects from Living in Mixed-Income Communities for Low-Income Families: A Review of the Literature, Urban Institute.

Todd Litman (2018), Evaluating Transportation Equity, Victoria Transport Policy Institute.

Michael J. Smart and Nicholas J. Klein (2015), A Longitudinal Analysis of Cars, Transit, and Employment Outcomes, Mineta National Transit Research Consortium.

Emily Talen and Julia Koschinsky (2013), Equality of Opportunity Project, Arizona State University.

Helena Titheridge, et al (2014), Transport and Poverty A Review of the Evidence, University College London.

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