Why Have Poorer Neighbourhoods Stagnated Economically while the Richer Have Flourished? …

Neighbourhood Income Inequality in Canadian Cities

 an article by Wen-Hao Chen and Garnett Picot (Research Branch, Statistics Canada, Ottawa) and John Myles (University of Toronto, Ontario) published in Urban Studies Volume 49 Number 4 (March 2012)

Abstract

Higher-income neighbourhoods in Canada’s eight largest cities flourished economically during the past quarter-century, while lower-income communities stagnated. This paper identifies some of the underlying processes that led to this outcome.

Increasing family income inequality drove much of the rise in neighbourhood inequality.

Increased spatial economic segregation, the increasing tendency of ‘like to live nearby like’, also played a role.

It is shown that these changes originated in the labour market. Changes in investment, pension income and government transfers played a very minor role. Yet it was not unemployment that differentiated the richer from poorer neighbourhoods. Rather, it was the type of job found, particularly the annual earnings generated.

The end result has been little improvement in economic resources in poor neighbourhoods during a period of substantial economic growth, and a rise in neighbourhood income inequality.

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