Chetty Study Offers Guide to Move Families to High-Upward-Mobility Areas

Opportunity Insights–a Harvard-based group of researchers and policy analysts, including economist Raj Chetty, who analyze data to help stakeholders make more informed policy decisions–has published a paper titled “Creating Moves to Opportunity: Experimental Evidence on Barriers to Neighborhood Choice.” The researchers, working in cooperation with the Seattle Housing Authority and King County Housing Authority, found that when families received the Creating Moves to Opportunity treatment (the treatment consisted of customized search assistance, landlord engagement, and short-term financial assistance), the fraction of families who moved to high-upward-mobility areas increased by forty percent between a control group and a treatment group.

Findings

The researchers found several insights during the course of their work. First, they found that in the Seattle area, Creating Moves to Opportunity (CMTO) interventions increased the fraction of families who moved to high-upward-mobility areas by forty percent between a control group and a treatment group. The researchers also found that utilization rates among groups remained the same (i.e., those families that chose to move to high-upward-mobility areas were able to use their vouchers at the same rate as the control group); all families across racial and ethnic groups benefited from the treatment; and families in opportunity areas were more satisfied with their new neighborhoods. The researchers also found that the customized manner of providing services according to each family’s need was crucial. Finally, the researchers found that other policy interventions such as higher payment standards (e.g., Small Area Fair Market Rents [SAFMR]) by themselves or providing additional rental information in a standardized manner were not effective. Indeed, on page 38 of the study, the researchers write “[o]ur analysis . . . shows that raising payment standards in more expensive neighborhoods —  as is typically done in SAFMR policies — does not necessarily induce families to move to higher-opportunity areas.”

Services Offered

The CMTO services consisted of three prongs (see pages 12 and 13 of the study):

1. Search Assistance (page 12);
   1. Information about high-opportunity areas and the benefits of moving to such areas for families with young children;
   2. Help in making rental applications more competitive by preparing rental documents and addressing issues in credit and rental history; and
   3. Search assistance to help families identify available units, connect with landlords in opportunity areas, and complete the application process;
2. Increased Landlord Engagement (page 13);
   1. Explaining to landlords in high-opportunity areas the program and encouraging them to lease their units;
   2. Damage mitigation fund to cover possible damages to a unit not included in the security deposit (up to $2,000);
   3. Expedited lease-up process for landlords through fast inspections and streamlined paperwork;
3. Short-term Financial Assistance (page 13);
   1. Funds for application screening fees, security deposits, and other expenses that stood in the way of lease-up;
   2. Payments were customized by staff to address the specific impediments a family faced; and
   3. On average families received $1,070 for these payments.

The researchers stressed that these services were tailored to meet the needs of individual families.

Defining Opportunity Areas

Opportunity areas were defined using Census tracts that have upward mobility in approximately the top third of the distribution across tracts within Seattle and King County. The definitions were adjusted to provide for contiguous areas and to take into account changes in neighborhoods. They were defined using data from the Opportunity Atlas.

Slides on the study can be found here.

A non-technical summary can be found here.

The full study can be found here.