Geography of Growing Up: Mapping Childhood Location to Later Life Outcomes

Yun So

The Economic Record, 2026, vol. 102, issue 336, 47-71

Abstract: This paper examines the causal effects of neighbourhood improvement during childhood (1996–2006) on tertiary educational attainment and adult income, using longitudinal census and administrative data from New Zealand. To address residential self‐selection, we restrict analysis to families who remained in the same location but experienced varying neighbourhood trajectories. Causal inference is implemented using Structural Nested Mean Models and Regression‐with‐Residuals, which adjust for time‐varying confounding while preserving causal pathways. Treatment is defined as an improvement of at least two deciles on the New Zealand Deprivation Index (NZDep). We study two cohorts: children from moderately deprived areas (NZDep 6) and those from more severely deprived areas (NZDep 7). Neighbourhood improvement substantially increases tertiary attainment in both groups: by 17.8 percentage points in NZDep 6 and 23.3 points in NZDep 7. The gains are particularly pronounced for Māori and Pasifika children, who experience improvements at least as large as, and in some cases exceeding, the overall average, underscoring the potential for neighbourhood upgrading to reduce ethnic inequalities in educational attainment. Treatment effects on adult earnings are 22.1% for NZDep 6 (not statistically significant) and 32.0% for NZDep 7 (marginally significant, P

Date: 2026
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