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Housing, Neighborhoods, and Inequality

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Handbook of Labor, Human Resources and Population Economics

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Abstract

This chapter provides an up-to-date review of the literature on housing, inequality, and neighborhoods while highlighting their many intersections. Inequality across and within countries is generally high and growing, particularly in terms of wealth. Levels and trends in inequality depend on multiple factors, such as institutions and varying exposure to shocks, and cannot be understood without accounting for the role of housing. Housing is a major component of households’ expenditures and the most important and evenly distributed asset in the population. Moreover, regional inequalities may not be as severe as they initially appear after accounting for differences in housing costs across geographies. Conversely, the negative outlook on these inequalities may be exacerbated when considering the implications of households’ uneven sorting within cities – with the most disadvantaged individuals predominantly residing in neighborhoods with lower-quality local public goods and amenities. Sorting endogenously arises due to multiple factors and impacts the dynamics and persistence of inequality through neighborhood effects, with schools playing a crucial role. National housing policies and interventions at the local level can help revert segregation and undesirable inequality dynamics. Housing allowances, tax incentives to build affordable housing in high-income neighborhoods, and school desegregation policies appear to be the most promising avenues to that goal.

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Acknowledgments

Responsible Section Editor: José Alberto Molina.

Gerard Domènech-Arumí and Paula Gobbi gratefully acknowledge financial support through the BELSPO Brain-be 2.0 funded project BE-PARADIS. Guillaume Chapelle acknowledges financial support from CY Initiative of Excellence (grant “Investissements d’Avenir” ANR-16-IDEX-0008), ANR-17-CE41-0008 (ECHOPPE) and ANR-20-CE22-0014 (AFFINITE). There is no conflict of interest.

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  1. CY Cergy Paris Université, Cergy, France

    Guillaume Chapelle

  2. ECARES, Université libre de Bruxelles, Brussels, Belgium

    Gerard Domènech-Arumí

  3. ECARES, Université libre de Bruxelles, and CEPR, Brussels, Belgium

    Paula Eugenia Gobbi

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    José Alberto Molina

  2. IEDIS, Zaragoza, Spain

    José Alberto Molina

  3. Global Labor Organization (GLO), Maastricht, The Netherlands

    José Alberto Molina

  4. Center for Population, Development and Labour Economics at UNU – MERIT, Maastricht University, Maastricht, The Netherlands

    Klaus F. Zimmermann

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Chapelle, G., Domènech-Arumí, G., Gobbi, P.E. (2024). Housing, Neighborhoods, and Inequality. In: Zimmermann, K.F. (eds) Handbook of Labor, Human Resources and Population Economics. Springer, Cham. https://doi.org/10.1007/978-3-319-57365-6_424-2

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    Housing, Neighborhoods, and Inequality
    Published:
    11 October 2023

    DOI: https://doi.org/10.1007/978-3-319-57365-6_424-2

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    Housing, Neighborhoods, and Inequality
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    08 June 2023

    DOI: https://doi.org/10.1007/978-3-319-57365-6_424-1

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