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CEP discussion paper
Does gentrification displace poor households? An 'identification-via-interaction' approach
Sevrin Waights
April 2018
Paper No' CEPDP1540:
Full Paper (pdf)

JEL Classification: R21; R23; R31; C20

Tags: neighbourhood change; mobility; turnover; causality; cities; urban; housing

My theoretical model motivates an ‘identification-via-interaction’ (IvI) approach that separates the causal impact of gentrification on poor exits from endogenous channels. In the empirical analysis, I create a measure of gentrification as the increase in the share of neighbourhood residents who hold a university degree based on the UK Census for 1991, 2001 and 2011. Applying the IvI approach for a sample of private renters from the British Household Panel Survey, 1991–2008, I find that gentrification results in displacement. The IvI approach has general applications in estimating causal relationships where variables are highly endogenous.