Giving Compass' Take:
- Robert Collinson and Jens Ludwig call for place-conscious policy to address the disparities between neighborhoods.
- How can funders help to support neighborhoods with fewer resources? Which neighborhoods in your community need additional support?
- Read lessons from place-based philanthropy.
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How much does place – that is, the neighborhood in which a family lives – affect one’s earnings, likelihood of being incarcerated, and other key life outcomes? To answer this question, in 1994 the U.S. Department of Housing and Urban Development (HUD) launched the Moving to Opportunity (MTO) demonstration. MTO enrolled several thousand families living in some of the most economically distressed public housing projects in the nation, and then via random lottery offered some the chance to use a housing voucher to relocate to a lower-poverty area. MTO thus provided what is arguably the first clear chance to credibly and convincingly isolate the effects of neighborhood per se on the lives of low-income families.
While previous studies had generally found that living in less distressed neighborhoods improved most family outcomes, the results from MTO suggested fewer benefits. Health (both mental and physical) improved for those who were adults at the time of enrolling in MTO as well as for the girls in these households. There were no improvements in economic outcomes for adults. And relocating to a lower-poverty area did help children achieve higher earnings when they became adults, but only for those who were relatively young at the time they moved.
Why did the MTO results differ so substantially from previous research? A number of hypotheses have been offered, such as the unusually high levels of disadvantage of MTO families, or the fact that families offered vouchers through the program moved to neighborhoods that had lower poverty rates but were not much more racially integrated the neighborhoods of those not offered vouchers. But as we explain below, we think the most likely explanation is that previous studies conflated the effects of neighborhood environments with those of hard-to-measure family background features that are associated with where families wind up living and with the outcomes we are trying to study. So we are inclined to put more weight that others on the results from MTO.
We also discuss the implications of MTO findings for public policy, under four main headings:
- Reforms to housing programs to ensure that they are targeted to those who stand to gain the most, particularly – in light of the MTO findings – households with young children
- Policies to improve a family’s chances of leasing in low-poverty neighborhoods
- Alternatives to housing mobility programs to improve the economic prospects of low-income adults
- Direct improvements in the quality of life in poor communities.
Read the full article about place-conscious policy by Robert Collinson and Jens Ludwig at Brookings.