Neighborhood environment, socioeconomic conditions, and intergenerational mobility

Abstract

Intergenerational mobility (IM) has recently generated significant attention. However, the mechanisms of IM, including the neighborhood effects, are still not well understood. This research aims to advance the research on IM by emphasizing the role of neighborhood environments and their mediating effects in the United States. Our results suggest that childhood neighborhood conditions significantly affect IM, and IM is determined by childhood physical and socioeconomic status (SES) or conditions and outmigration. Specifically, we find that natural and built environments affect IM indirectly through neighborhood SES, and, therefore, the effect of SES has been overestimated. Moreover, there are complex pathways linking neighborhood SES to IM. A dense, mixed-use, and walkable neighborhood may show lower IM because such neighborhoods usually have higher concentrations of poor people and single parents. We also find that outmigration is a pathway to IM. Desirable childhood neighborhood environments and high outmigration returns lead to higher IM in rural areas than in urban areas, and also higher IM in the West North Central region than in the East South Central and South Atlantic regions, although these regions have similarly low SES. Our study highlights the significant effects of the neighborhood environment on IM.