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Urban poverty: Theory and evidence from American cities

Francesco Andreoli (), Mauro Mussini () and Vincenzo Prete ()
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Mauro Mussini: Department of Economics (University of Verona)
Vincenzo Prete: Department of Economics (University of Verona)

No 08/2019, Working Papers from University of Verona, Department of Economics

Abstract: The concentrated poverty index, i.e. the proportion of a metro area's poor population living in extreme-poverty neighborhoods, is widely adopted as a policy-relevant measure of urban poverty. We challenge this view and develop a family of new indices of urban poverty that, differently from concentrated poverty measures, i) capture aspects of the incidence and distribution of poverty across neighborhoods and ii) are grounded on empirical evidence that living in a high poverty neighborhood is detrimental for many dimensions of residents' well-being. We demonstrate that a parsimonious axiomatic model that incorporates these two aspects characterizes exactly one urban poverty index. We show that changes of this urban poverty index within the same city are additively decomposable into the contribution of demographic, convergence, re-ranking and spatial effects. We collect new evidence of heterogeneous patterns and trends of urban poverty across American metro areas over the last 35 years and use city characteristics to identify relevant drivers.

Keywords: Concentrated poverty; axiomatic; decomposition; census; ACS; spatial (search for similar items in EconPapers)
JEL-codes: C34 D31 H24 P25 (search for similar items in EconPapers)
Date: 2019-06
New Economics Papers: this item is included in nep-ure
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