Hostname: page-component-cd9895bd7-dk4vv Total loading time: 0 Render date: 2024-12-25T19:39:04.777Z Has data issue: false hasContentIssue false

The Local Economic Effects of Public Housing in the United States, 1940–1970

Published online by Cambridge University Press:  15 November 2013

Katharine L. Shester*
Affiliation:
Assistant Professor, Department of Economics, Washington and Lee University, Lexington, VA 24450. E-mail: shesterk@wlu.edu.

Abstract

Between 1933 and 1973 the federal government funded the construction of over 1 million units of low-rent housing. Using county-level data, I find that communities with high densities of public housing had lower median family income, lower median property values, lower population density, and a higher percentage of families with low income in 1970. However, I find no negative effects of public housing in 1950 or 1960, implying that long-run negative effects only became apparent in the 1960s. The effects found in 1970 are partially due to a decline in human capital.

Type
Articles
Copyright
Copyright © The Economic History Association 2013 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

The author gratefully acknowledges helpful insights from the editor Paul Rhode, two anonymous referees, William J. Collins, Samuel K. Allen, Jeremy Atack, George Ehrhardt, Daniel Fetter, Price Fishback, Malcolm Getz, Arthur H. Goldsmith, A. Joseph Guse, Cindy Kam, Gregory T. Niemesh, Edgar O. Olsen, John J. Siegfried, and Helen Yang; and suggestions from seminar participants at the Southern Economic Association Meetings (2011), the Appalachian Spring World History and Economics Conference (2012), the Cliometrics Conference (2012), Yale University (2012), the Washington Area Economic History Group (2012), and Washington and Lee University (2012). Part of this research was supported by Vanderbilt University's Social Science Dissertation Fellowship and by Washington and Lee University's Lenfest Summer Grant.

References

REFERENCES

Altonji, Joseph G., Elder, Todd E., and Taber, Christopher R.. “Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools.” Journal of Political Economy 113, no. 1 (2005): 151–84.CrossRefGoogle Scholar
Ananat, Elizabeth Oltmans.The Wrong Side(s) of the Tracks: The Causal Effects of Racial Segregation on Urban Poverty and Inequality.” AEJ: Applied Economics 3, no. 2 (2001): 3466.Google Scholar
Bauer, Catherine.The Dreary Deadlock of Public Housing.” Architectural Forum 106, no. 5 (1957): 140–42, 219, 221.Google Scholar
Bellows, John, and Miguel, Edward. “War and Local Collective Action in Sierra Leone.” Journal of Public Economics 93, no. 11 (2009): 1144–57.CrossRefGoogle Scholar
Bingham, Richard D.Public Housing and Urban Renewal: An Analysis of Federal-Local Relations. New York: Praeger Publishers, 1975.Google Scholar
Collins, William J., and Margo, Robert A.. “Residential Segregation and Socioeconomic Outcomes: When Did Ghettos Go Bad?Economic Letters 69, no. 2 (2000): 239–43.CrossRefGoogle Scholar
Coulibaly, Modibo, Green, Rodney D., and James, David. Segregation in Federally Subsidized Low-Income Housing in the United States. Westport, CT: Praeger Publishers, 1998.Google Scholar
Cullen, Julie Berry, and Levitt, Steven D.. “Crime, Urban Flight, and the Consequences for Cities.” The Review of Economics and Statistics 81, no. 2 (1999): 159–69.CrossRefGoogle Scholar
Currie, Janet, and Yelowitz, Aaron. “Are Public Housing Projects Good for Kids?Journal of Public Economics 75, no. 1 (2000): 99124.CrossRefGoogle Scholar
Cutler, David M., and Glaeser, Edward L.. “Are Ghettos Good or Bad?The Quarterly Journal of Economics 112, no. 3 (1997): 827–72.CrossRefGoogle Scholar
Democratic Party Platforms: “Democratic Party Platform of 1940,” July 15, 1940. Online by Gerhard Peters and John T. Woolley, The American Presidency Project (http://www.presidency.ucsb.edu/ws/?pid=29597).Google Scholar
Ellen, Ingrid Gould.Spillovers and Subsidized Housing: The Impact of Subsidized Rental Housing on Neighborhoods.” Working Paper RR07-3, Joint Center for Housing Studies, Harvard University, Cambridge, MA, 2007.Google Scholar
Ellen, Ingrid Gould, Schwartz, Amy Ellen, Voicu, Ioan, and Schill, Michael H.. “Does Federally Subsidized Rental Housing Depress Neighborhood Property Values?Journal of Policy Analysis and Management 26, no. 2 (2007): 257–80.CrossRefGoogle Scholar
Epp, Gayle.Emerging Strategies for Revitalizing Public Housing Communities.” Housing Policy Debate 7, no. 3 (1996): 563–88.CrossRefGoogle Scholar
Fisher, Robert Moore.Twenty Years of Public Housing. New York: Harper, 1959.Google Scholar
Freedman, Leonard.Public Housing: The Politics of Poverty. New York: Holt, Rinehart and Winston, Inc., 1969.Google Scholar
Friedman, Lawrence M.Public Housing and the Poor: An Overview.” California Law Review 54 (1966): 642–69.CrossRefGoogle Scholar
Fuerst, J. S.When Public Housing Was Paradise: Building Community in Chicago. Westport, CT: Praeger Publishers, 1966.Google Scholar
Goetz, Edward G., Lam, Hin Kin, and Heitlinger, Anne. “There Goes the Neighborhood? The Impact of Subsidized Multi-Family Housing on Urban Neighborhoods.” Center for Urban and Regional Affairs and Neighborhood Planning for Community Revitalization Paper 96-1, 1996.Google Scholar
Grigsby, William G.Housing Markets and Public Policy. Philadelphia: University of Pennsylvania Press, 1963.CrossRefGoogle Scholar
Haines, Michael R.Historical, Demographic, Economic, and Social Data: The United States, 1790–2000 [computer file]. ICPSR Study 2896. Ann Arbor, MI: Inter-university Consortium for Political and Social Research, 2004.Google Scholar
Harris, John R., and Todaro, Michael P.. “Migration, Unemployment, and Development: A Two-Sector Analysis.” American Economic Review 60, no. 1 (1970): 126–42.Google Scholar
Hirsch, Arnold R.Making the Second Ghetto. New York: Cambridge University Press, 1983.Google Scholar
Hunt, D. Bradford.What Went Wrong with Public Housing in Chicago? A History of the Robert Taylor Homes.” Journal of the Illinois State Historical Society 94, no. 1 (2001): 96123.Google Scholar
Husock, Howard.America's Trillion-Dollar Housing Mistake. New York: The Manhattan Institute, 2003.Google Scholar
Jacob, Brian A.Public Housing, Housing Vouchers, and Student Achievement: Evidence from Public Housing Demolitions in Chicago.” American Economic Review 94, no. 1 (2004): 233–58.CrossRefGoogle Scholar
Jacob, Brian A., and Ludwig, Jens. “The Effects of Housing Assistance on Labor Supply: Evidence from a Voucher Lottery.” American Economic Review 102, no. 1 (2012): 272304.CrossRefGoogle Scholar
Jones, Ronald, Kaminsky, David, and Roanhouse, Michael. Problems Affecting Low-Rent Public Housing Projects. Washington, DC: U.S. Department of Housing and Urban Development, Office of Policy Development and Research, 1979.Google Scholar
Katz, Lawrence F., Kling, Jeffrey R., and Liebman, Jeffrey B.. “Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment.” Quarterly Journal of Economics 116, no. 2 (2001): 607–54.CrossRefGoogle Scholar
King, James E.The Impact of Federal Housing Policy on Urban African American Families,1930–1966. San Francisco, CA: Austin & Winfield, 1996.Google Scholar
Kling, Jeffrey R., Liebman, Jeffrey B., and Katz, Lawrence F.. “Experimental Analysis of Neighborhood Effects.” Econometrica 75, no. 1 (2007): 83119.CrossRefGoogle Scholar
Kraft, John, and Olsen, Edgar O.. “The Distribution of Benefits from Public Housing.” In The Distribution of Economic Well-Being, edited by Juster, F. T., 5170. New York: National Bureau of Economic Research, 1977.Google Scholar
Lee, Chang-Moo, Culhane, Dennis P., and Wachter, Susan M.. “The Differential Impacts of Federally Assisted Housing Programs on Nearby Property Values: A Philadelphia Case Study.” Housing Policy Debate 10, no. 2 (1999): 7593.CrossRefGoogle Scholar
Leip, David. “Dave Leip's Atlas of U.S. Presidential Elections.” Electronic database: http://uselectionatlas.org/, 2009.Google Scholar
Lyons, Robert F., and Loveridge, Scott. “An Hedonic Estimation of the Effect of Federally Subsidized Housing on Nearby Residential Property Values.” Staff Paper P93-6, St. Paul: Department of Agriculture and Applied Economics, University of Minnesota, 1993.Google Scholar
Massey, Douglas S., and Denton, Nancy A.. American Apartheid: Segregation and the Making of the Underclass. Cambridge, MA: Harvard University Press, 1993.Google Scholar
Massey, Douglas S., and Kanaiaupuni, Shawn M.. “Public Housing and the Concentration of Poverty.” Social Science Quarterly 74, no. 1 (1993):109–23.Google Scholar
McNulty, Thomas L., and Holloway, Steven R.. “Race, Crime, and Public Housing in Atlanta: Testing a Conditional Effect Hypothesis.” Social Forces 79, no. 2 (2000): 707–29.CrossRefGoogle Scholar
Meehan, Eugene J.The Rise and Fall of Public Housing.” In A Decent Home and Environment: Housing Urban America, edited by Phares, Donald, 342. Cambridge, MA: Ballinger Publishing Company, 1977.Google Scholar
Phares, DonaldThe Quality of Federal Policymaking: Programmed Failure in Public Housing. Columbia: University of Missouri Press, 1979.Google Scholar
Meyer, Bruce D.Do the Poor Move to Receive Higher Welfare Benefits?” Working Paper, Northwestern University, 2000.Google Scholar
Moffitt, Robert.Incentive Effects of the U.S. Welfare System: A Review.” Journal of Economic Literature 30, no. 1 (1992): 161.Google Scholar
Mulvihill, Roger.Problems in the Management of Public Housing.” Temple Law Review 35 (1961): 163–94.Google Scholar
Muth, Richard F.Public Housing: An Economic Evaluation. Washington, DC: American Enterprise Institute for Public Policy Research, 1973.Google Scholar
Nourse, Hugh O.The Effect of Public Housing on Property Values in St. Louis.” Land Economics 39, no. 4 (1963): 433–41.CrossRefGoogle Scholar
Olsen, Edgar O.Housing Programs for Low-Income Households.” In Means-Tested Transfer Programs in the United States, edited by Moffitt, Robert, 365442. Chicago: University of Chicago Press, 2003.CrossRefGoogle Scholar
Olsen, Edgar O., and Barton, David M.. “The Benefits and Costs of Public Housing in New York City.” Journal of Public Economics 20, no. 3 (1983): 299332.CrossRefGoogle Scholar
Olsen, Edgar O., Tyler, Catherine A., King, Jonathan W., and Carrillo, Paul E.. “The Effects of Different Types of Housing Assistance on Earnings and Employment.” Cityscape: A Journal of Policy Development and Research 8, no. 2 (2005): 163–87.Google Scholar
Oreopoulos, Philip.The Long-Run Consequences of Living in a Poor Neighborhood.” The Quarterly Journal of Economics 118, no. 4 (2003): 1533–75.CrossRefGoogle Scholar
Orlebeke, Charles J.The Evolution of Low-Income Housing Policy, 1949 to 1999.” Housing Policy Debate 11, no. 2 (2000): 489520.CrossRefGoogle Scholar
Oster, Emily.Unobservable Selection and Coefficient Stability: Theory and Validation.” Working Paper, University of Chicago Booth School of Business, August 15, 2013.CrossRefGoogle Scholar
Painter, Gary.Does Variation in Public Housing Waiting Lists Induce Intra-Urban Mobility.” Journal of Housing Economics 6, no. 3 (1997): 248–76.CrossRefGoogle Scholar
Popkin, Susan J., Rosenbaum, James E., and Meaden, Patricia M.. “Labor Market Experiences of Low-Income Black Women in Middle-Class Suburbs: Evidence from a Survey of Gautreaux Program Participants.” Journal of Policy Analysis and Management 12, no. 3 (1993): 556–73.CrossRefGoogle Scholar
Rabiega, William A., Lin, Ta-Win, and Robinson, Linda M.. “The Property Value Impacts of Public Housing Projects in Low and Moderate Density.” Land Economics 60, no. 2 (1984): 174–79.CrossRefGoogle Scholar
Radford, Gail.Modern Housing for America: Policy Struggles in the New Deal Era. Chicago: The University of Chicago Press, 1996.CrossRefGoogle Scholar
Republican Party Platforms: “Republican Party Platform of 1940,” June 24, 1940. Online by Gerhard Peters and John T. Woolley, The American Presidency Project. http://www.presidency.ucsb.edu/ws/?pid=29640.Google Scholar
Roback, Jennifer.Wages, Rents, and the Quality of Life.” Journal of Political Economy 90, no. 6 (1982): 1257–78.CrossRefGoogle Scholar
Rosenbaum, James E.Changing the Geography of Opportunity by Expanding Residential Choice: Lessons from the Gautreaux Program.” Housing Policy Debate 6, no. 1 (1995): 231–70.CrossRefGoogle Scholar
Rossi-Hansberg, Esteben, Sarte, Pierre-Daniel, and Owens III, Raymond. “Housing Externalities.” Journal of Political Economy 118, no. 3 (2010): 485535.CrossRefGoogle Scholar
Ruggles, Steven J., Alexander, Trent, Genadek, Katie, Goeken, Ronald, Schroeder, Matthew B., and Sobek, Matthew. Integrated Public Use Microdata Series: Version 5.0 [Machine-readable database]. Minneapolis: University of Minnesota, 2010.Google Scholar
Salisbury, Harrison E.The Shook Up Generation. New York: Harper & Brothers, 1958.Google Scholar
Schnare, Ann B.The Preservation Needs of Public Housing.” Housing Policy Debate 2, no. 2 (1991): 289306.CrossRefGoogle Scholar
Schwartz, Amy Ellen, Ellen, Ingrid Gould, Voicu, Ioan, and Schill, Michael H.. “The External Effects of Place-Based Subsidized Housing.” Regional Science and Urban Economics 36, no. 6 (2006): 679707.CrossRefGoogle Scholar
Silverman, Abner.Basic Needs and Social Services.” In Papers Submitted to Subcommittee on Housing Panels on Housing Production, Housing Demand, and Developing a Suitable Living Environment. 579606. Washington, DC: Committee on Banking and Currency, U.S. Housing of Representatives, 92nd Congress, 1971.Google Scholar
Sinai, Todd, and Waldfogel, Joel. “Do Low-Income Housing Subsidies Increase the Occupied Housing Stock?Journal of Public Economics 89, no. 11–12 (2005): 2137–64.CrossRefGoogle Scholar
U.S. Bureau of the Census. Census of Population. Volume 1. Characteristics of the Population: 1960. Washington, DC: GPO, 1963.Google Scholar
U.S. Bureau of the Census. Census of Population. Volume 1. Characteristics of the Population: 1970. Washington, DC: GPO, 1973.Google Scholar
United States Department of Housing and Urban Development. Consolidated Development Directory. Washington, DC: GPO, 1973.Google Scholar
United States Housing and Home Finance Agency. Federal Laws: Low Rent Public Housing: The United States Housing Act of 1937 and Related Laws. Washington DC: Public Housing Administration, 1964.Google Scholar
Venkatesh, Sudhir Alladi.American Project: The Rise and Fall of a Modern Ghetto. Cambridge, MA: Harvard University Press, 2000.CrossRefGoogle Scholar
von Hoffman, Alexander.A Study in Contradictions: The Origins and Legacy of the Housing Act of 1949.” Housing Policy Debate 11, no. 2 (2000): 299329.CrossRefGoogle Scholar
Weicher, John C.Housing: Federal Policies and Programs. Washington, DC: American Enterprise Institute for Public Policy Research, 1980.Google Scholar
Williams, Rhonda Y.The Politics of Public Housing. New York: Oxford University Press, 2004.CrossRefGoogle Scholar
Yelowitz, Aaron S.Public Housing and Labor Supply.” Working Paper, University of Kentucky, 2001.Google Scholar
Supplementary material: File

Shester supplementary material 1

Shester supplementary material 1

Download Shester supplementary material 1(File)
File 90 KB
Supplementary material: PDF

Shester supplementary material 2

Shester supplementary material 2

Download Shester supplementary material 2(PDF)
PDF 205.1 KB