City Land Use Pattern: Impacts Climbing the Income Ladder?
|December 1, 2013||Posted by Staff under Economic Principles|
Among adults who grew up in the bottom half of the income distribution, only one out of 25 had family income of at least $100,000 by age 30. But one of every three 30-year-olds who grew up in the top 1 percent of the income distribution was already making at least $100,000 in family income.
This 2013 excerpt of the New York Times, Jly 22, is by DavidLeonhardt.
Climbing the income ladder occurs less often in the Southeast and industrial Midwest, with the odds notably low in Atlanta, Charlotte, Memphis, Raleigh, Indianapolis, Cincinnati, and Columbus. By contrast, some of the highest rates occur in the Northeast, Great Plains, and West, including in New York, Boston, Salt Lake City, Pittsburgh, Seattle, and large swaths of California and Minnesota.
That variation does not stem simply from the fact that some areas have higher average incomes: upward mobility rates often differ sharply in areas where average income is similar, like Atlanta and Seattle. Fairly poor children in Seattle —- those who grew up in the 25th percentile of the national income distribution -— do as well financially when they grow up as middle-class children -— those who grew up at the 50th percentile -— from Atlanta.
In Atlanta, concentrated poverty, extensive traffic, and a weak public-transit system make it difficult to get to the job opportunities.
Four broad factors affect income mobility, including the size and dispersion of the local middle class. All else being equal, upward mobility tended to be higher in metropolitan areas where poor families were more dispersed among mixed-income neighborhoods.
Income mobility was also higher in areas with more two-parent households, better elementary schools and high schools, and more civic engagement, including membership in religious and community groups.
Larger tax credits for the poor and higher taxes on the affluent seemed to improve income mobility only slightly. There’s only modest or no correlation between mobility and the number of local colleges and their tuition rates or between mobility and the amount of extreme wealth in a region.
Children who moved at a young age from a low-mobility area to a high-mobility area did almost as well as those who spent their entire childhoods in a higher-mobility area. But children who moved as teenagers did less well.
Ed. Notes: To change cities from habitats for cars to habitats for people, you could change land from an object of speculation to a source of common wealth. Where owners pay a land tax (or could be Land Dues or land-use fees), they can’t afford to speculate so they keep their land at best use. Their individual acts of development add up to in-filling the city, making it more compact, which makes mass transit (getting to work) more efficient.
New development adds to the stock of buildings, both residences and businesses, so neighborhoods have more variety of goods and services. Living in a city that’s pretty and fun gives residents some civic pride, which leads to civic involvement. Pretty soon they’ll have all the ducks in a row to make upward mobility easier and commonplace.
When Denmark shifted to a land tax (1957, an article also in the New York Times), workers received their biggest raise in pay in Danish history, proof that this revenue reform works.