Transforming Communities for Inclusive Growth

William Lambe
Federal Reserve Bank of Atlanta

Theresa Singleton
Federal Reserve Bank of Philadelphia

Susan Wachter
University of Pennsylvania

The analysis and conclusions set forth in this introduction are solely the responsibility of the authors and do not indicate concurrence by the Federal Reserve Bank of Atlanta, the Federal Reserve Bank of Philadelphia, or the Federal Reserve System.

Economic opportunities in the United States have become increasingly concentrated in communities that are inaccessible to many Americans. Authors in this symposium describe a troubling and challenging reality—that good jobs, schools, and housing are, in many places, out of reach, especially for lowincome families. This reality is the consequence of several mutually reinforcing trends—high-wage, high-skill jobs are increasing in certain places, but not everywhere; those places are growing more expensive; and expensive places are becoming more rich with amenities, including good schools.

In this symposium, the authors synthesize and update recent research findings to describe the forces and factors behind these trends. Arthur Acolin and Susan Wachter frame the challenges facing local officials attempting to reinvent older communities (Acolin and Wachter, 2017). Economic segregation is growing in part as a result of localities that exclude through a lack of affordable housing, a phenomenon that is now occurring on a regional scale. Acolin and Wachter describe the growing economic importance of knowledge- and innovation-based industries and the clustering of such industries in places with a ready supply of highly educated workers. This clustering in turn drives up the productivity of the places in which they concentrate, resulting in more and better jobs for people with the education and skills to fill them. These productive places are further enriched, in a reinforcing cycle, with good schools, safe neighborhoods, and other markers of opportunity