Neighbourhood Effects Research: New Perspectives

Abstract

Over the last 25 years a vast body of literature has been published investigating neighbourhood effects: the idea that neighbourhood characteristics can have a significant effect on residents’ life chances over and above the effect of their individual characteristics. There is little doubt that neighbourhood effects exist, but we know little about the causal mechanisms which produce them, their relative importance compared to individual characteristics, and under which circumstances and in which places these effects are important. This chapter discusses some of the main theoretical and empirical challenges in neighbourhood effects research, related to the identification of true causal effects. An over emphasis on statistical techniques to overcome the problems related to modelling selection bias had distracted us from a much more important issue: the theoretical and empirical identification of potential causal pathways behind neighbourhood effects. This chapter offers seven ways forward for neighbourhood effects research: development of clear hypotheses; empirically testing explicit hypotheses; investigating neighbourhood selection; integrate models of neighbourhood selection and models of neighbourhood effects; investigate various spatial scales; development of better longitudinal data; and the use of mixed methods research.