Transformed Neighborhoods And Household Characteristics

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Master of Arts

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Over the years, neighborhoods across the country have undergone transformation. There has always been a tendency to examine the superficial causes of transformations. Several studies in the literature focus on racial transformation as a key driver of neighborhood change. This study departs from the usual trend of examining neighborhood transformation by looking at just the racial component of neighborhood change. Rather, in addition to examining the racial composition of neighborhoods, it also seeks to analyze the underlying characteristics of households that make up neighborhoods with a view to understanding how changes in household characteristics drive transformation. The economic and policy implications of the resulting relationships are then discussed. The study utilizes publicly available Census Data at the zip code level in the United States for year 2000 and 2010. Neighborhoods were classified into six broad categories based on certain definitions: Minority-Gentrified, Minority-Stable, Minority-Transformed, Majority-Gentrified, Majority-Stable, and Majority-Transformed. The results revealed that most minority neighborhoods tend to be concentrated in the inner-city while majority neighborhoods are typically found in the suburbs and rural areas. Each of these neighborhood types has distinct household characteristics; hence, the need to identify these characteristics and their short term and long term implications on the demand for public goods. The study found that majority neighborhoods are generally characterized by high income households, lower than average household size, high level of employment and high rates of home ownership. Local governments in majority neighborhoods have access to more resources that can be utilized in funding developmental projects. On the other hand, minority neighborhoods lag significantly behind majority neighborhoods and lack the optimum combination of characteristics needed to support a vital neighborhood. As such local governments presiding over them tend to scramble for resources to meet the growing needs of their constituents.