Sprawl and Economic Mobility

Paul Krugman was spurred by Detroit’s bankruptcy to put up a few posts about the link between sprawl, prosperity, and economic mobility. He started with a comparison of Detroit and Pittsburgh, and then went on to look at a general relationship, including a comparison of Boston and Atlanta1. I wanted to expand a little on these posts, since I think they’re good, but missing some important details.

Steeltown vs. Motown

First, the tale of two rustbelt cities. Krugman says it’s obvious that Detroit’s central city has collapsed, while Pittsburgh has had a revival, and cites a Brookings report on job sprawl. The report shows that Pittsburgh’s jobs are much more centrally located than Detroit’s, and Krugman concludes that “sprawl killed Detroit, by depriving it of the kind of environment that could incubate new sources of prosperity”.

Let’s add the Los Angeles MSA, where manufacturing is of comparable importance and where jobs are distributed like they are in Detroit. So what does the Brookings data show? Here’s the breakdown of Detroit, Pittsburgh, and LA jobs data from the report:

Det-Pitt-LA jobs

So the core of Pittsburgh lost jobs during that time period, and over 90% of the job growth was more than 10 miles from the core. Unless the contention is that preserving the core is juicing job growth out in the suburbs, the argument that Pittsburgh’s economy was saved by preserving the core doesn’t seem to be that strong. Meanwhile, LA was not doomed by job sprawl, and Pittsburgh is less dense than Detroit by weighted density. Pittsburgh is your classic small- to mid-size East Coast city, with a lot of jobs in the core, very low density suburbs, and a lot of people commuting to the CBD. But at any rate, Las Vegas and Phoenix also rank highly in the Brookings report – in fact, their jobs are more concentrated than Pittsburgh’s. Y’all ‘bout to tell Detroit to emulate them?

Sprawl may have bankrupted Detroit, but  it has been a particularly malicious kind of sprawl. Detroit has been forced – and given all of the history, I use that word deliberately – by the rest of the region to suffer unduly. Declining population does not necessarily doom a city, because increasing incomes and productivity mean that each resident can support more infrastructure. But if the population declines and there’s extreme income segregation, the city is screwed. It is impossible to look at Detroit without looking at a long history of horrible discrimination.

Moving On Up… Out of the South

Speaking of horrible discrimination, it’s also a factor in upward mobility. This is getting way out of my comfort zone but I think it’s important, so I’m going to give it a shot anyway.

Krugman writes a post citing this David Leonhardt article that in turn cites this study that was originally about the economic impact of tax expenditures. Now when I looked at the map at the top of the Leonhardt article, my reaction was: no duh. If you grow up in the Deep South or on an Indian Reservation, you’re going to be at a huge disadvantage. Nothing new there. But I also believe that denser development contributes to upward mobility by facilitating matching and reducing transaction costs. Krugman put up a chart of the largest ten metro areas comparing weighted density to upward mobility. I’ve expanded this to the all MSAs with population over 300,000.2 I excluded New York, Los Angeles, San Francisco, and Honolulu, since their weighted densities are much greater than the other MSAs.

weighted-mobility

Pretty solid correlation. But in light of the map at the top of the Leonhardt article, I wanted to try to correct for geography, so I added a dummy variable for being located in the South. I’m defining the South as the ex-Confederate states, less Texas and Florida, which have undergone major demographic changes. Here’s the same data split into two groups.

sorted-mobility

Yup. I ran a regression on upward mobility using weighted density and the dummy as the independent variables. They are both predictive, and both statistically significant. Note that if you divide the coefficients, the result is that being in the South has the same impact as decreasing weighted density by 7,790 people per square mile. But it may even be worse than that: if you restrict the analysis to Southern cities, the impact of weighted density is statistically insignificant.

regress-south

Ok, you say, but it’s pretty obvious that there’s a major correlation (r=-0.45) between weighted density and the dummy South variable. And other than Newport News and New Orleans, we don’t have any Southern cities with weighted density over 2,500 people per square mile. Maybe that variable is useless because of the correlation or insufficient sample size. I’m glad you asked. Let’s add something with a weaker correlation3 (r=-0.20) to weighted density but still related to racism: percent African-American. Here’s the results of that regression.

regress-AfAm

Weighted density is still important, and percent African-American is important, but the dummy South variable is now statistically insignificant. So racism isn’t just in the South. The authors of the initial study noted the impact of race as well, and they ran some regressions (page 31) to compare white upward mobility to overall upward mobility. They found that where upward mobility is bad, it is bad for both black and white residents, and conclude that the pattern in upward mobility is not driven by racial composition.

To which I say: not really. By that same logic, you could look at the fact that few Confederate soldiers owned slaves and conclude that the Civil War was not about slavery. After all, they had no economic interest in perpetuating that system. But that’s how the politics of racism works: it is all about keeping those people down in their place; everything else comes after. Consider that 74% of white Mississippians said they would vote for the Republican candidate for governor in the last election. That governor is doing things, like opting out of the Medicaid expansion and moving forward with a voter ID law, that are going to screw poor white Mississippians out of upward mobility. But at least he won’t be letting black people get any, and that’s the whole point.

This may seem far afield from a blog about land use, transportation, and economics in Los Angeles, but it’s not. Racism and racist policies are morally wrong, but they also have economic consequences. By denying a group of people full humanity, they waste human and economic potential, reduce innovation, and keep the region from improving the human experience as much as possible.

So yes, let’s talk about how sprawl hurt Detroit. And let’s talk about how allowing greater density increases economic mobility. But let’s also be forthright and honest about the long history and impact of discriminatory policies, and the need for change. When you read things like Richard Florida saying that mobility is prevented by a class and skill divide, remember, it’s partly true, but it’s also true that we still don’t live in a post-racial society.

1I was originally planning to talk about the comparison of Boston, Atlanta, and Los Angeles in this post, but that ended up being irrelevant to the main point here, so I’m saving that for another post.

2The data in the Leonhardt article seems to be presented in terms of CSAs, not MSAs, so I had to assume that all constituent MSAs in a CSA are the same.

3The Atlantic did an article that looks at percent African-American versus weighted density, but only for the ten largest metros outside New York, which is a small sample size.

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