A new study from Harvard's Opportunity Insights team examines the long-term effects of the federal HOPE VI program, which invested $17 billion between the 1990s and 2000s to transform 262 distressed public housing developments across the country into mixed-income communities.
By tracking more than one million public housing residents over nearly three decades, researchers found that while adults who lived in the revitalized housing saw no direct economic gains, children who grew up in these transformed neighborhoods earned substantially more as adults.
Key findings from the research include:
- Adults living in public housing did not experience income gains from revitalization. Neighborhood poverty rates fell by 10 percentage points after HOPE VI projects were completed, but this was driven by higher-income residents moving into new market-rate units.
- Children raised in revitalized public housing earned 16 percent more at age 30. Those who lived in these neighborhoods from birth earned roughly 50 percent more over their lifetimes. They were also more likely to attend college and less likely to be incarcerated.
- The earnings gains exceed the cost of revitalization. Each revitalized unit cost taxpayers approximately $170,000, but the lifetime earnings gains for children raised in that unit totaled around $500,000 in present value.
- Stronger social connections drove the improvements. Children in revitalized housing interacted more with higher-income neighbors in surrounding areas and benefited most when those nearby peers came from more affluent families.
The findings carry implications for current federal efforts like HUD's Choice Neighborhoods program and suggest that connecting isolated low-income communities to surrounding areas may be among the most cost-effective strategies for expanding economic mobility.
Resources
Creating High-Opportunity Neighborhoods: Evidence from the HOPE VI Program (PDF)
Map of Candidate Neighborhoods for Connection-Based Revitalization