Moving to Opportunity in Boston: early results of a randomized mobility experiment

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Moving to Opportunity in Boston early results of
a randomized mobility experiment

• Lawrence F. Katz Jeffrey R. Kling Jeffrey B.
  Liebman
• Presented by Paul Lewin

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Reference

• Katz, L., J.R. Kling, and J.B. Liebman. 2001.
  Moving to Opportunity in Boston Early Results
  of a Randomized Mobility Experiment. Quarterly
  Journal of Economics 116(2) 607-654.

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Contents

1. Background Information
2. The Research
3. Data Method
4. Results Conclusion

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I. Background Information
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A. Poverty

• 1970-1990 poor persons in metro areas
  increased.
• Tracts w/ poverty rate 40 increased from 12 to
  18
• Federal housing policies contribute to this
  trend.
• Public housing development 1950s 1960s
• Poorest eligible households 1980s
• Increase segregation by income race

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B. Neighborhoods effects

• Current well-being Future opportunities
• Neighborhood characteristics
• School quality, safety from crime
• Peers influence youth behavior
• Also, youth outcomes could reflect family
  background

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C. Moving to Opportunity (MTO)

• Baltimore, Boston, Chicago, Los Angeles New
  York
• Since 1994 (study was done 1996-1998)
• Eligible families
• Children
• Reside in public housing or project-base Section
  8 assisted housing
• Census (1990) tracts with poverty rate 40

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C. Moving to Opportunity (MTO)

• Programs groups (randomly assigned)
• Experimental group
• Restrictive housing voucher - 700/month
• Only can be used in low poverty area -under 10
  poverty rate
• Counseling assistance -1827/household
• To help families search for an apartment
• And adjust to a new neighborhood

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C. Moving to Opportunity (MTO)

• Section 8 Comparison group
• Unrestricted housing voucher -700/month
• No counseling assistance
• Control group
• 4-6 m. to submit a house, which must pass an
  inspection

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II. The Research
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A. Researchers Interest

• Comprehensive evaluation of impacts of the MTO
• Impacts of neighborhood attributes on
• Child human capital accumulation
• Adult economic outcomes
• Safety and adult mental health.
• They have a long-run effects on child outcomes
  and family well-being

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Children Human Capital Accumulation

• Peer influence
• Educational choices, crime, delinquent behaviors
• Contagion effects (learning from peers)
• Stigma effects (declining of negative signals)
• Physical externalities (reduced chances to be
  arrested)
• Adult influence
• Human capital externalities role models,
  enforcers public order
• Community resource
• Schools, recreational activities, labor market
  opportunities
• Reduce child problem behavior
• Increase perceived returns from education

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Adult Economic Outcomes

• Moving to a suburban neighborhoods
• Increase access to employment opportunities
• Low poverty areas Supportive of work lower
  welfare usage
• Disrupt social support networks
• Child care, job referrals, labor market
  information
• The effect of moves become positive over time,
  but it is ambiguous in the short run

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Safety and Adult Mental Health

• Families moving out of high poverty public
  housing should experience
• Improved neighborhood safety
• Improved housing conditions
• Reduction in parental stress and anxiety
• Positive effects offset by social isolation

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Data Methods
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A. The Data

• Qualitative fieldwork
• Surveys
• MTO survey prior to enrollment
• MTO-Boston Follow-up Survey
• Administrative records
• Massachusetts Department of Revenues
  Longitudinal Data Base
• Welfare employment impact

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Eligible Families That Complete Application and
Survey
Random Assignment to one of Three Groups
Experimental Treatment Group
Section 8 Treatment Group
Control Group
Z0
Z1
Dont Use Voucher
Use Voucher
Dont Use Voucher
Use Voucher
Would Use Voucher
Would not Use Voucher
1
2
3
4
C1
5
6
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B. Method
Impact of being offered the opportunity to move
with MTO
Intent-to-Treat (ITT).
Treatment-on-Treated (TOT)
Average effect of the treatment on those who
actually receive the treatment
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III. Results Conclusion
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g

• Difficult to find apartment
• Transportation cost
• Social isolation
• Census tracts restriction more important than the
  counselor

Experimental group were much more likely to live
outside the city

• Local areas in which treatment groups were living
  were different from the control
• Section 8 had smaller differences with control
  group

Experimental group shows increase in school
average reading and math score
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(1- 3.5 years after)
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• Children in both treatment groups exhibit fewer
  behavior problems.
• Experimental group children have lower prevalence
  of injuries and asthma attack

• Changes in neighborhoods induced by MTO have no
  effect in adult economy self-sufficiency

• There are improvements in the perceived safety of
  treatment group

• There are improvements in health status and
  mental health of household heads

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Housing Policies

• Housing vouchers improves the well-being
• Benefits from moving are large for children
• Vouchers generate positive intergenerational
  externalities
• Unknown impact of MTO on families left behind
• Vouchers are insufficient to overcome the labor
  market disadvantages of inner-city, single mothers

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Questions

• Thank you