Category: economist

North Carolina, land of lost opportunity?

As more researchers burrow in to the idea of economic mobility, the Equality of Opportunity Project (led by four economists, two from University of California-Berkeley and two from Harvard) has ranked the 100 largest U.S. cities on the economic mobility of children, looking specifically at the odds of a child reaching the top fifth income group if he or she started life in the bottom fifth. Here’s a link to the rankings.

The big news for those of us in the Carolinas is that our two states are propping up the bottom of the list.

Four of the bottom five cities are in North Carolina. Another is Columbia, S.C. In order, starting at 100, are Memphis, Fayetteville (N.C.), Charlotte, Columbia, Atlanta, Greensboro, Detroit, Raleigh, Indianapolis, Columbus. Greenville (S.C.) is No. 11 from the bottom.

The study looked at “commuting zones” for cities, which is a different regional configuration than looking at Metropolitan Statistical Areas or just at city limits.

As this Salon.com article (“Class warfare in Dixieland”) notes, the bottom of the list is dominated by Southern cities. It doesn’t point out that all six of the Carolinas cities in the study are scraping the bottom of the list.

The big question – why? – is not addressed in the research. Theories abound, including in the Salon.com article. 

Case of Case-Shiller dishes

(More from “The Next City” conference last weekend in Cambridge. I encountered blogus interruptus when my Mac laptop went on strike. I’m doing a series of notebook-dumping posts.)

Chip Case (right), Wellesley College economist and a founder of the Case-Shiller Home Price Index, was quite entertaining and not what you might expect from an academic in “the dismal science.”

A Chip Case joke: “I had an economist call me the other day, said he couldn’t sell his house and what should he do. I said, ‘For Christ’s sake you’re an economist! It’s worth — I hate to tell you — what someone’s willing to pay for it!’ “

Chip Case prediction on the commercial real estate: “It’s the next shoe to fall.” Every worker lost (and the U.S. job loss from December 2007 to March 2009 has been 5.1 million), creates an average vacancy of 180 square feet. “That stuff is still being held on the books of banks at par,” he said.

Case response when asked about the so-called “American Dream of Homeownership”?
“It’s largely bulls—.” He went on to say, “Rental is better for a lot of people (unless they bought during a boom).”

John King, urban design writer for the San Francisco Chronicle: What about all the starter-home suburbs?
Case: I don’t know. They’re going to stagnate.

Me (buttonholing Case after his talk): What advice would you give to governments and policymakers on how to deal with stagnating starter home suburbs?
Case: I’d appoint a housing czar, inventory what’s out there, what condition it’s in, and start buying. Buy, and hold until it’s needed.

He then acknowledged state and local governments have no money. “The only government with money is the one that’s printing it.”