Assessing the Evidence on Neighborhood Effects from Moving to Opportunity
||Original Paper: WP 11-01|
This paper shows that treatment effects of the Moving to Opportunity (MTO) housing mobility program should not be interpreted as evidence on neighborhood effects. In a standard joint model of potential outcomes and selection into treatment, defining treatment as moving with an MTO voucher generates a model of program effects, while defining treatment as moving to a high-quality neighborhood generates a model of neighborhood effects. I state the assumptions necessary for using the random assignment of vouchers in a housing mobility program as an instrument to identify neighborhood effects. I then show that the literature using program effects to learn about neighborhood effects implicitly imposes dubious versions of these assumptions.
Keywords: Moving to Opportunity, Neighborhood Effect, Program Effect, Marginal Treatment Effect, Essential Heterogeneity, Strong Ignorability.
JEL Codes: C30, H50, I38, J10, R00.
Suggested citation: Aliprantis, Dionissi, 2014. “Assessing the Evidence on Neighborhood Effects from Moving to Opportunity,” Federal Reserve Bank of Cleveland, Working Paper no. 12-33R.