By Winston Riddick
The purpose of this paper is to investigate the determinants of concentrated poverty, a phenomenon where socioeconomically deprived groups are heavily concentrated in particular neighborhoods in a metropolitan area. Drawing on Land Use Theory and the Spatial Mismatch Hypothesis, I develop a theory that identifies suburbanization as a principal cause of poverty concentration. Using interstate highway expansion as a source of exogenous variation in suburbanization rates, I evaluate this relationship in 240 U.S. Metropolitan Statistical Areas (MSAs) from 1960-1990, with concentrated poverty measured at the tract level. Panel regressions with MSA Fixed Effects find a positive and significant relationship between highway expansion and increased poverty concentration under a variety of specifications, including alternative measures of highways and an instrumented measure of urban population decline.
Advisor: Charles Becker, Michelle Connolly | JEL Codes: I30, J61, R13, R40 | Tagged: