Association for Public Policy Analysis & Management

In cities throughout the United States, the pace of gentrification has accelerated in the past two decades (Ellen and Ding, 2017), and debates around the appropriate policy response have intensified. Many critics demand that governments take actions to slow the pace of change, charging that this gentrification leads to displacement and resegregation. But at least in the short-run, gentrification increases economic integration, and often furthers racial and ethnic integration as well, as affluent white households opt for diverse, city neighborhoods over high-income, racially homogenous suburbs. The key question is whether this integration is only fleeting, or whether cities experiencing greater gentrification end up with more economically and racially integrated neighborhoods over time. Yet there is surprisingly little research examining the longer-run trajectory of neighborhoods experiencing gentrification, so fair housing advocates are left to speculate.

We aim to fill this gap. Using the Neighborhood Change Database (NCDB), we examine the long-run dynamics of neighborhoods that undergo gentrification (defined as an increase in income, percentage college-educated, or percentage white). We show the degree to which gentrification in U.S. cities in one decade has led to stable economic and racial integration in subsequent decades, and in what contexts. In brief, we find that the integration produced by gentrification is considerably more stable than many think, but the rising rents that accompany it mean that lower-income households, absent subsidies, will likely find it increasingly difficult to move in and remain in gentrifying neighborhoods over time.

With these stylized facts as background, we consider implications for fair housing, and weigh a set of policy interventions. Most policy discussions surrounding gentrification center on efforts to protect individual residents at risk of displacement through legal representation or tenant-based vouchers. Yet while these efforts can be critical in helping individual tenants, they will do little over the longer run to preserve economic and racial diversity, which are shaped much more by the composition of people moving into a neighborhood than by the pattern of exits. Thus we also consider a set of policies that can help to make gentrifying neighborhoods more inclusive, or more welcoming to a diverse set of households over the longer-run, including the place-based subsidized housing investments that fair housing advocates have traditionally scorned.