The impact of highway proximity on distribution centres’ rents

Gaston Tchang, VU University Amsterdam

http://usj.sagepub.com/content/early/2015/07/28/0042098015596930.abstract

Driving along Dutch highways I often see distribution centres located in the vicinity. I wondered if the reason just is just to be seen by passing traffic or, thinking as an economist, that there is another cost-related reason. With common sense one expects higher rents near highways due to scarcity of land adjacent to highways and as well as being visible to passers-by.

When I was searching the literature on the impact of the proximity of highways on rent, I found that most  of the articles were about the impact on housing rent. There were also a lot of studies about the impact on office rents. But I couldn't find one about the impact on distribution centres' rent. Given the importance of transport costs in the logistics industry it is surprising that there had been no previous study. So this was a good reason to conduct a study myself. Since I am familiar with logistics in the Netherlands, and had access to Dutch data, I focussed my research on the Netherlands.

My aim was to find out how much rent of a distribution centre increases when accessibility improves. I have taken two different approaches. First I looked to the impact of the proximity to the nearest highway. Then I examined the impact of the distance to the centre of the Netherlands on the basis that a central location can reduce transport costs for logistic companies. I found an increasing rent for a decreasing distance. When distance decreases transport costs will be saved. As long as transport cost savings exceed the increased rent it is more attractive to choose a location closer to a highway or closer to the centre of the Netherlands. Transport costs are a major cost for logistic companies.

The results found are entirely plausible and may be useful for policymakers which are responsible for the development of industrial areas, e.g. at a local level to set the land rent and e.g. at a regional level to determine the zoning of land (e.g. by limiting the surface of industrial area allocated to distribution centres in a region). I suspect that real estate developers already advantage from the willingness of logistic companies to pay higher rents to locate  close to highways since land rent is often determined per industrial area or by the type of industrial activity according to the zoning.

The abstract can be found at: http://usj.sagepub.com/content/early/2015/07/28/0042098015596930?papetoc

                                           (Author's own)
                         
                               A distribution centre located in an industrial area in the Netherlands

Displacement and gentrification in England and Wales: A quasi-experimental approach

Lance Freeman (Columbia University, USA), Adèle Cassola (Columbia University, USA), Tiacheng Cai (Columbia University, USA)

Abstract can be found: http://usj.sagepub.com/content/early/2015/09/03/0042098015598120

The question of gentrification’s impact on low-income households remains a topic of heated debate among urban researchers and residents. In recent years, numerous studies have been dedicated to examining one of the most traumatic potential outcomes of gentrification – the direct displacement of the neighborhood’s existing residents. Several U.S.-based studies have examined whether gentrification leads to displacement using quasi-experimental methods, which try to account for what would have happened in the absence of gentrification by comparing mobility rates in neighborhoods that are similar but for experiencing gentrification. These studies have found no consistent evidence that low-income households are more likely to move out of gentrifying than non-gentrifying neighborhoods. Our study was motivated by the notion that because people move less frequently on average in England and Wales than in the US, it might be easier to distinguish patterns of elevated mobility due to gentrification in this context.

Using the British Household Panel Survey, we compared households’ odds of moving in three types of neighborhoods: disadvantaged neighborhoods that did not gentrify between 2001 and 2009; disadvantaged neighborhoods that gentrified during this period; and relatively advantaged neighborhoods. For the entire sample of England and Wales, low-income and working-class households living in gentrifying neighborhoods were not more likely to move than comparable households in neighborhoods that did not gentrify. In London, on the other hand, low-income households in gentrifying neighborhoods were more likely to move than similar households in non-gentrifying neighborhoods. However, because this finding did not hold up when different measures of gentrification were used, we cannot make a strong case that gentrification leads to displacement based on this analysis.

The lack of compelling evidence of gentrification-induced direct displacement in this and previous quasi-experimental studies is hard to reconcile with first-hand accounts of direct displacement. Displacement from gentrifying neighborhoods clearly occurs, so why have so many statistical studies failed to detect higher rates of mobility among vulnerable residents from these neighborhoods?

We suggest the following explanation. Turnover rates tend to be higher in disadvantaged neighborhoods, but when such neighborhoods gentrify, some residents who would otherwise have left might decide to stay put because they like the neighborhood’s trajectory. Others might dislike the changes and move. Others might wish to move, but find no acceptable alternatives. Still others will be directly displaced from the neighborhood. However, the increased mobility due to direct and indirect displacement and the reduced mobility among those who stay put may balance each other out. Consequently, the overall rate of mobility may differ little from what existed prior to gentrification.

A failure to statistically detect direct displacement therefore does not mean that we can write off gentrification as a policy concern. Moreover, direct displacement is not the only form of displacement experienced by residents of gentrifying neighborhoods. Those who are not directly displaced may nonetheless feel alienated by the changes occurring in their neighborhood. Gentrification may also reduce the stock of low-cost housing in affected neighborhoods, thus excluding low-income households that otherwise would have moved in. Given the complexity of these processes and their enduring impact on urban residents and neighborhoods, there is no doubt that gentrification and displacement will continue to inspire much debate and research in the years to come.  

Better residential than ethnic discrimination! Reconciling audit andinterview findings in the Parisian housing market

François Bonnet (CNRS, UMR Pacte), Etienne Lalé (Department of Economics, University of Bristol), Mirna Safi (Department of Sociology and OSC, Sciences Po) and Etienne Wasmer (Department of Economics and LIEPP, Sciences Po)

Abstract can be found: http://usj.sagepub.com/content/early/2015/07/28/0042098015596107.abstract?rss=1 

We started out this research with two questions. First, is there a banlieue effect operating in the Parisian housing market, i.e. does living in a deprived neighborhood per se undermine the prospects for residential mobility? Second, is it possible to separate this effect from discrimination caused by another potential stigma, namely the ethnic origin (North-African background) of those living in the French banlieues? Answering these questions is of importance for a broad range of academics studying discrimination and the cumulative effects of residential and ethnic/racial inequalities. The French context makes this task all the more challenging and interesting. Indeed, the French Republican model embraces a color-blind, universalistic model of race relations, which notably implies rejecting ethnicity as the basis of categories for official statistics. Recent studies, partly in the aftermath of the 2005 urban riots in France, have challenged the myth of a color-blind society.[i] They provide evidence of discrimination in the labor market. However, at present, there is almost no audit study based evidence of discrimination in the housing market in France.

A distinctive feature of our research is to make complementary use of two methodological designs. We conducted: (i) an experimental paired-testing audit study involving (fictitious) housing applicants and (ii) a series of face-to-face interviews with real-estate agents in Paris and the Paris region. Thus, our research has potential of offering both statistical and discursive evidence on discrimination in the housing market. After juxtaposing the findings from the audit and the interviews, we do find an interesting paradox:

• While the current (alleged) residence of housing applicants has a significant negative effect in the audit, real estate agents clearly deny its relevance as a discriminatory factor affecting access to housing;
• Real estate agents overwhelmingly report that ethnic origin has a discriminatory impact, whereas ethnic origin has no significant effect in the audit when we control for the current residence of housing applicants.

We offer several hypotheses that may solve this apparent paradox. We especially favour the following two hypotheses which, in our view, should not be seen as mutually exclusive.

First, the findings could reflect statistical discrimination whereby real estate agents seek to proxy the risk of non-payment of the rent (insolvency). In particular, residential and ethnic origins could correlate with access to housing simply because real estate agents use these characteristics to infer the risk that truly matter to them. Real estate agents deny the relevance of residential origin as a discriminatory factor with good reasons, in that only insolvency is relevant. In the meantime, if residential origin is strongly correlated with the risk of insolvency, then controlling for this variable explains why ethnic origin does not play a statistically significant role in the audit study data.

            

The other hypothesis is that there is an ethnic stigma and that residential origin is used to proxy ethnicity. That is, it may be that overt information about ethnic origin (like, for instance, an African name) is not used to discriminate against housing applicants because such biased decisions appear highly undesirable. Strong correlates with ethnicity (like, for instance, residential origin) are instead used to select housing applicants. This would explain why real estate agents report that residential origin is not a discriminatory factor while ethnic origin is. This would also help understanding why, in the audit study, overtly signalling ethnicity through the housing applicant's name did not result in discriminatory behaviours.

The more important conclusion of our article is that the complementary use of different methodological designs helps overcome the shortcomings of each. In this respect, the paradox we find is anything but a weakness of this research: it proved very instrumental in developing rich hypotheses to understand discrimination.

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[i]      To our knowledge, the most comprehensive study is the audit conducted jointly by the ministry of labour and the International Labour Organization in 2008. The results, presented in a report written by Eric Cediey and Fabrice Foroni (“Discrimination in access to employment on grounds of foreign origin in France: A national survey of discrimination based on the testing methodology of the International Labour Office”), reveal  that employers prefer candidates perceived as being of “national” origin (French) to strictly identical candidates of African immigrant background in 80% of all cases.

13 out 17 organisations did not comply with CCTV regulations

Keith Spiller (Open University, UK)

Recently I rang the telephone numbers displayed on CCTV signs. After all, this is my right. By law CCTV cameras must be accompanied by signs that notify me I am being recorded and the signs must also provide contact information, just in case I want to see my images. When I sought those images from 17 different cameras only 4 provided my images.

I have been researching in the area of surveillance and surveillance studies for a number of years now and I have a deep interest in how laws governing aspects of surveillance actually work, as well as how people react and live with surveillance. CCTV is probably one of the most recognisable aspects of surveillance; indeed, it is the symbol that most often accompanies any mention of surveillance in the media. So, what better system to examine just how the regulations work in an urban setting.

The control of CCTV in the UK falls under the remit of the Data Protection Act (1998) and Article 8 of the European Convention on Human Rights. Cameras monitoring private and public spaces for security purposes must adhere to the regulations set out in the Act.  Specifically CCTV operators and data managers must notify people that they are being recorded, must store images with ‘integrity’ and must provide data to anyone requesting their images.

On a mild November morning I walked around the centre of a south of England city and deliberately stood under visible CCTV cameras, in an effort to get myself caught on CCTV.  In total 17 cameras recorded my movement at 2 shopping malls, 3 department stores, 4 banks, 1 stadium, 1 railway station, 1 bus station, 1 university, 1 open street system, 1 town hall, 1 government building and 1 museum.

7 of these cameras had no visible contact information on their signs and of the 10 that did, 4 of the telephone numbers were dead or produced no response. I then resorted to the organisation’s webpages to find contact numbers. Which proved more fruitful, however even when contact was made, staff often did not have the correct information to hand or where unsure how to deal with my requests.

The standard way of asking for CCTV images is to submit a Subject Access Requests (SAR) and this is what I then did, writing to all 17 organisations. The responses I received detailed how on 4 occasions I did not appear in the footage, this despite standing for up to 2 minutes under cameras. My SARs on two occasion got ‘lost’ as the organisations had no record of receiving them, on other occasions my images had been deleted as systems automatically deleted files after 7 days -  this despite making my request within 24 hours of standing under the cameras. Further responses demanded £20 plus VAT to process the request, even when the fee an organisation can charge is only £10.

Evident is the poor ability of organisations to deal with requests for CCTV images or simply they don’t want the hassle, or quite possibly the camera are not on. Nevertheless, what has become clear is the ease of access to urban CCTV images is certainly not as straightforward as the legislation would like it to be. For more detail on this research please see ‘Experiences of accessing CCTV data: theurban topologies of subject access requests’ published in Urban Studies.

Neighborhood Ethnic Composition and Outcomes for Low-Income Latino and African American Children

George Galster (Wayne State University) and Anna Santiago (Michigan State University)

Abstract found at: http://usj.sagepub.com/content/early/2015/07/28/0042098015598067.full 

Investigating the adverse consequences of residential segregation for ethnic minority people has a long and distinguished social scientific history in the U.S.  Rigorous studies have identified substantial socioeconomic and health costs that segregation imposes on Latinos and African Americans, though often with contingencies based on ethnicity and gender.

What these quantitative studies do not reveal, however, are the complex underlying pathways through which segregation exacts its toll.  Do the primary mechanism(s) operate through confining minorities in inferior neighborhoods that constrain opportunities because they offer inadequate public services, more intense pollution, poorer access to employment, higher rates of violence and/or concentrated poverty and joblessness?  Or, does segregation operate independently of these ethnically correlated aspects of geographic context and instead work through ethnic composition of the neighborhood per se?  Might concentrations of ethnic minorities impose costs (or benefits) regardless of the particulars of the places where they are concentrated, due to socialization processes within minority communities and/or stereotyping and stigmatizing processes by majority populations external to them?  Stated differently, the issue needing empirical investigation is the degree to which ethnic residential segregation affects the life chances of minorities irrespective of the particular features of the places where they are concentrated beyond disproportionate ethnic clustering.

In this paper we focus on a variety of outcomes for individual children, youth and young adults (“children” hereafter) from the groups commonly thought to suffer the greatest harms from residential segregation in the U.S.: low-income Latino and African American families.  Our original approach bridges two traditionally distinct literatures: “consequences of segregation” and “neighborhood effects.”  The forces of segregation operating at the regional scale inevitably generate one direct outcome at the neighborhood scale: increasing exposures of minority children to neighbors from other minority groups.  They generate another outcome indirectly following from the concentration of minorities: shaping the geographic flows of resources (financial, institutional, human, environmental) and thereby the opportunities and quality of life available to minority children in those neighborhoods.  Potentially both direct and indirect effects of segregation affect child developmental outcomes by altering their neighborhood contexts.  Distinguishing these two effects constitutes the core empirical test of our paper. 

Specifically, our research questions for low-income Latino and African American children are:

            To what extent are the odds of ever experiencing a variety of childhood outcomes in the domains of health, exposure to and use of violence, education and fertility related to the percentages of Latino and African American residents in their census tracts? [i.e., the direct effects of segregation]

            If so, to what degree do these relationships persist when controlling for neighborhood indicators of socioeconomic status, safety, housing stock, institutional resources and environmental conditions ?[ i.e., the indirect effects of segregation]

We answer these questions through a stratified, logistic regression analysis of data on minority children that we collected through a retrospective survey of Latino and African American families whose children resided in Denver (CO) Housing Authority (DHA) dwellings during at least part of their childhood.  This program represents an unusual natural experiment holding great potential for overcoming geographic selection bias because assignment of households on the DHA waiting list to public housing mimics a random process, thereby permitting causal inferences about neighborhood indicators and child outcomes.  Because DHA dwellings are located in a wide variety of neighborhoods throughout Denver County, it also offers an unusual opportunity of observing how low-income minority children fare in places that differ on a host of other neighborhood characteristics beside ethnic composition that we measure comprehensively. 

Regarding our first research question, results show that low-income, Latino and (especially) African American children growing up amid greater concentrations of African American neighbors in Denver pay penalties across several outcome domains, controlling for their own, households’ and caregivers’ characteristics.  By contrast, growing up among greater concentrations of Latino neighbors is associated with both positive and negative outcomes for African American and (especially) Latino children. 

Specifically, low-income African American children living in a neighborhood with a standard deviation-higher percentage of African American residents are predicted to have greater odds of: (1) an asthma diagnosis by 52 percent; (2) witnessing violence in the neighborhood by 62 percent; (3) being victimized in the neighborhood by 78 percent; (4) using violence themselves by 39 percent; and (5) having a child outside of marriage by 51 percent.  These associations with harmful outcomes are more limited for low-income Latino children.  Latino children living in a neighborhood with a standard deviation-higher percentage of African American residents are predicted to have greater odds of: (1) being victims of neighborhood crime by 82 percent; and (2) repeating a grade in school by three percent. 

By contrast, concentrations of Latino neighbors are associated with positive and negative outcomes for children of both ethnicities.  Latino children living in a neighborhood with a standard deviation-higher percentage of Latino residents are predicted to have 56 percent greater odds of witnessing violence, but lower odds of: (1) using violence by 35 percent; (2) dropping out before a diploma by two percent; and (3) having children outside of marriage by 29 percent.  Of interest, the positive dropping out result also applied to African American children in our sample.  However, if they were to live amid a standard deviation-higher percentage of Latino residents they are predicted to have 51 percent greater odds of being victimized in the neighborhood. 

Our second research question asks the extent to which the aforementioned associations persist when a host of non-ethnic neighborhood indicators are added to the models.  Results reveal that all the aforementioned associations between African American neighborhood composition and adverse outcomes for African American children disappear when other aspects of residential context are controlled.  The same is true for Latino children, with one exception (odds of repeating a grade).  Similarly, the few aforementioned associations between African American neighborhood composition and adverse outcomes for African American children disappear when other aspects of residential context are controlled.  Indeed, with the one exception of repeating a grade, all five statistically significant parameters for neighborhood ethnic composition indicate more favorable minority child outcomes.  Controlling for non-ethnic aspects of residential context, low-income African American children living in a neighborhood with a standard deviation-higher percentage of African American residents are predicted to have 84 percent lower odds of an asthma diagnosis.[1]  Were they to live in a neighborhood with a standard deviation-higher percentage of Latino residents, they are predicted to have lower odds of: (1) witnessing violence by 78 percent; (2) using violence by 71 percent; and (3) having a nonmarital birth by 89 percent.  Ethnic effects on low-income Latino children appear more limited.  When they live in a neighborhood with a standard deviation-higher percentage of Latino residents they are predicted to have eight percent lower odds of dropping out of school.

So if ethnic composition per se is not responsible for the negative associations between segregation and negative outcomes, what is?  Two aspects of the residential environment stand out as consistent predictors of negative outcomes:  higher property crime rates and lower occupational prestige among resident workers.  For both Latino and African American children, higher property crime rates are associated with substantially greater odds of: asthma diagnosis, witnessing and being victimized by violence, and repeating a grade; for Latinos the same associations apply to engaging in violence, dropping out, and having children outside of marriage.  For African American children, lower occupational prestige is associated with substantially greater odds of: asthma diagnosis, witnessing violence, dropping out and having children outside of marriage.  For Latino children it is associated with substantially greater odds of: being victimized by and engaging in violence, dropping out and having children outside of marriage.

Several other aspects of neighborhood context prove predictive for certain outcomes and ethnicities.  Places with negative peer influences as assessed by caregivers are associated with greater odds that African American children will witness, be victimized by, and engage in violence.  Places with more social problems (an index focusing in violent and criminal behaviors) as assessed by caregivers are associated with greater odds that Latino children will have these same exposure to violence outcomes, plus have children outside of marriage.

In conclusion, growing up amid concentrations of African American residents was associated with a variety of adverse outcomes for low-income Latino and (especially) African American children, though outcomes associated with concentrations of Latino residents were more mixed.  Virtually all of the negative associations disappeared, however, when other aspects of the residential context were controlled, and several positive ones persisted.  The adverse developmental consequences of ethnic segregation appeared to be generated primarily by concentrating minority children in neighborhoods with higher rates of property crime and lower occupational prestige.

We see our study as bridging two substantial scholarly literatures: consequences of ethnic segregation and neighborhood effects.  We have linked them by positing that the forces of segregation operating at the metropolitan scale directly shape children’s intra-neighborhood exposure to various ethnic groups.  Moreover, because ethnic composition of neighborhoods affects the flows of various resources into them, segregation indirectly affects children’s exposure to non-ethnic aspects of their local context.  Our empirical findings indicate that it is the indirect effects of segregation that create by far the more pernicious neighborhood effects for low-income Latino and African American children.

Our results clearly suggest that policymakers should be cognizant of neighborhood ethnic segregation as an important metropolitan force that continues to shape the developmental context of low-income minority children.  It is not neighborhood ethnic composition per se, but rather the correlated aspects of safety and social status that appear crucial.  Our finding is thus fully consistent with the position that desegregation efforts should not be motivated by an implicit valorization of “whiteness” or stigmatization of “non-whiteness.”

The daunting policy challenge is providing neighborhood environments that are developmentally friendly to low-income, minority children.  This can be approached in principle by either by improving the neighborhoods where they live through community development strategies and/or by improving their access to developmentally superior neighborhoods through well-designed assisted housing programs backed by vigorous fair housing enforcement.  We acknowledge the political difficulties involved in doing so in practice, but urge continued efforts in these regards nevertheless.

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[1] We acknowledge that this is an ambiguous finding insofar as it may indicate a lower probability of caregivers seeking medical diagnosis given a set of symptoms, instead of a lower probability of symptoms.