In the context of the San Francisco Fed’s work, equity refers to the idea that all people can fully contribute their talents and skills to participate in and benefit from the economy, regardless of their race, ethnicity, geographic location, or any other demographic factor. At the San Francisco Fed, we study underlying conditions that shape people’s access to opportunity as part of our mission to promote a healthy, inclusive, sustainable economy and support the nation’s financial and payment systems. Where people live—i.e., what cities or neighborhoods are affordable to them—within a region such as the Bay Area, the Inland Empire, the Seattle metro area, or the Salt Lake City metro area affects their starting point for economic participation.

Regional equity is the set of interrelated factors that affects opportunity and economic participation in regions. Notably, access to quality schools, affordable homes, and convenient, affordable transportation options help shape people’s access to jobs, household financial stability, and long-term career paths. Studying regional equity helps us understand barriers people face to participating in the economy, such as by having a job or starting a business.

Research suggests that equitable regions produce better economic outcomes, in addition to their benefits for individuals and communities. In a 2015 study, Chris Benner and Manuel Pastor observe a positive relationship between the ability of a metropolitan region to sustain job growth and indicators of higher levels of regional equity, such as having lower income inequality, less residential segregation, lower barriers to regional governance, and less of a divide in poverty rates between cities and suburbs. Another recent study on smaller regions by Amanda Weinstein, Michael Hicks, and Emily Wornell found a positive relationship between quality of life investments in amenities such as schools and transportation options, and growth in employment and population. One of the largest challenges for efforts to increase regional equity is balancing jobs and housing.

Read the full article about regional equity at the Federal Reserve Bank of San Fransisco.