Growing up in a sprawling neighborhood could cost you nearly $3,000 in annual income compared to living in a more compact area, according to new research that reveals how urban development patterns may be undermining the American Dream for low-income families.
A series of studies from the University of Utah has found that children from low-income families who grow up in areas characterized by urban sprawl face significantly reduced earning potential compared to those raised in denser neighborhoods. The research provides the most detailed evidence yet of how city planning decisions could be reinforcing cycles of poverty across generations.
“If someone grew up at a tract in a 10th percentile sprawl, so very low sprawl, rather than a 90th percentile sprawl, which is very high sprawl, their expected annual income was $2,864 higher, which was almost 10% or a few percentage points in the income ranking,” explains study co-author Kelsey Carlston, now an assistant professor of economics at Gonzaga University.
Not All Neighborhoods Are Created Equal
The research team, led by Professor Yehua Dennis Wei of the University of Utah’s School of Environment, Society & Sustainability, analyzed data from over 71,000 census tracts across the United States. They defined sprawl as urban environments with poor pedestrian access, heavy car dependency, and sharp separation between residential, commercial and business areas.
“One finding is that typical livable-city indicators, like walkability, mixed-use development and job-housing balance, improve intergenerational mobility,” notes Wei. However, he cautions that the relationship isn’t always straightforward: “We find that those kinds of dense mixed-use walkable neighborhoods sometimes have lower intergenerational mobility because of high concentrations of low-income families and single-parent families, and sometimes also minority populations.”
A Tale of Two Income Levels
Perhaps most striking is how sprawl affects families differently based on income level. While children from low-income families see reduced earning potential in sprawling areas, the opposite appears true for wealthy families.
“In high-income families, kids in sprawling neighborhoods did slightly better,” Carlston notes, highlighting how urban development patterns may be inadvertently deepening economic divides.
Following the Money
The researchers utilized a powerful dataset called the Opportunity Atlas, which matches IRS tax records of adults born between 1978 and 1983 to their parents’ tax records. This allowed them to track economic mobility across generations with unprecedented precision.
While the study shows a strong correlation between sprawl and reduced social mobility, Carlston emphasizes they haven’t proven causation. However, she points to several likely mechanisms: “Sprawling areas are often broken into smaller municipalities, which means that the number of resources like community centers and parks that you have is more dependent on the income of the immediate residents.”
Solutions on the Horizon
“We probably can’t turn Atlanta into New York City, but we could shape neighborhoods to be built for everyone,” Carlston suggests. “Additionally, we could try to reduce the negative effects of sprawl by increasing connectivity with better transit and finding mechanisms to spread funding throughout metropolitan areas.”
The findings appear to have significant implications for city planners and policymakers. As Carlston notes, “local city planners and officials need to consider the broader social implications and choose zoning patterns and regulations that are best for all residents, particularly trying to reduce sprawl and increase infill development may have a long-lasting positive impact on children’s economic possibilities.”