Of Cities and Slums

Luciene Pereira, Pedro Ferreira and Alexander Monge-Naranjo
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Luciene Pereira: Fundação Getulio Vargas

No 1308, 2017 Meeting Papers from Society for Economic Dynamics

Abstract: The emergence of slums is a common feature in a country's path towards urbanization, structural transformation and development. Based on salient micro and macro evidence of Brazilian labor, housing and education markets, we construct a simple model to examine the conditions for slums to emerge. We then use the model to examine whether slums are barriers or stepping stones for lower skilled households and for the development of the country as a whole. We calibrate our model to explore the dynamic interaction between skill formation, income inequality and structural transformation with the rise (and potential fall) of slums in Brazil. We then conduct policy counterfactuals. For instance, we find that cracking down on slums could slow down the acquisition of human capital, the growth of cities (outside slums) and non-agricultural employment. The impact of reducing housing barriers to entry into cities and of different forms of school integration between the city and the slums is also explored.

Date: 2017
New Economics Papers: this item is included in nep-dge, nep-lam and nep-ure
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Related works:
Working Paper: Of cities and slums (2024)
Working Paper: Of Cities and Slums (2018)
Working Paper: Of Cities and Slums (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:red:sed017:1308

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