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

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.

Contents

1. Background Information

2. The Research

3. Data & Method

4. Results & Conclusion

I. Background Information

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

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

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%

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

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

II. The Research

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

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

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

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

Data & Methods

A. The Data

Qualitative fieldwork Surveys

• MTO survey prior to enrollment

• MTO-Boston Follow-up Survey

Administrative records• Massachusetts Department of Revenue’s

Longitudinal Data Base • Welfare & employment impact

Eligible Families ThatComplete Application and Survey

ExperimentalTreatment

Group

Section 8Treatment

GroupControl Group

RandomAssignmentto one of ThreeGroups

Don’tUse

Voucher

UseVoucher

UseVoucher

Don’tUse

Voucher

WouldUse

Voucher

Would notUse

Voucher

1 2 3 4 5 6

Z=0Z=1

C=1

B. Method

Treatment-on-Treated (TOT)

Intent-to-Treat (ITT).

Impact of being offered the opportunity to move with MTO

Average effect of the treatment on those who actually receive the treatment

III. Results & Conclusion

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

(1- 3.5 years after)

•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 health status and mental health of household heads

•There are improvements in the perceived safety of treatment group

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

Questions

Thank you