Gentrification and Blight: Relationship to Involuntary Displacement

• Date: 01 March 2020
• DOI: http://doi.org/10.1111/ajes.12325
• Published date: 01 March 2020
• Author: Rick Rybeck

Gentrification and Blight: Relationship to

Involuntary Displacement

By Rick Rybeck*

AbstRAct. Because homelessness is visible in cities with high levels

of gentrification, the media have linked the two phenomena. But the

displacement taking place in most American cities is due more to

blight than to gentrification. This article examines both sources of

displacement and traces them to the same source: land speculation.

In declining cities, land speculation causes parcels to be held vacant

in prime locations, leading to disinvestment and an inadequate

supply of affordable commercial and residential buildings. In cities

with booming economies, land speculation leads to redevelopment

of entire neighborhoods where land appreciates in value due to new

commercial or residential demand. The solution to gentrification and

blight as sources of displacement is to increase land value return

and recycling to stabilize urban economies and avoid the boom-bust

cycles that are so detrimental to cities.

Introduction

In some cities in the United States, bitter controversy surrounds gen-

trification, the process by which high-income residents and upscale

businesses displace less affluent neighbors by outbidding them for

space. Some of those same cities are also known for large and visible

homeless populations. As a result, there is a tendency to link the two

phenomena and to blame homelessness on the displacement caused

by gentrification. This is a gross oversimplification, as I shall explain

in this article. In addition to our failure to provide residential sup-

port for people with mental illness, homelessness is influenced by

employment opportunities, wage levels (some homeless people are

working two or three jobs), and housing affordability. Displacement

American Journal of Economics and Sociology, Vol. 79, No. 2 (March, 2020).

DOI: 10.1111/ajes.12325

© 2020 American Journal of Economics and Sociology, Inc

*Director of Just Economics, a firm in Washington, DC, that helps communities harmo-

nize economic incentives with public policy objectives. Email: r.rybeck@justeconomicsllc.

com

542 The American Journal of Economics and Sociology

is a manifestation of the lack of employment and affordable housing,

but gentrification is only one cause of displacement.

Communities and neighborhoods evolve and change. Residents are

born, get older, and die. New generations have different values or

different ways of expressing them. Some people move in and some

move out. Businesses open, mature, and close. Infrastructure that con-

nects one neighborhood to another or provides local amenities may

improve or decline over time. Private buildings are improved, main-

tained, or allowed to deteriorate. Communities and neighborhoods

are defined not only by geographical boundaries and a variety of

physical attributes, both natural and human-made, but also by rela-

tionships between the people who occupy them. Occupants include

both residents and visitors. Visitors might include regular visitors such

as daily employees who live outside the jurisdiction where they work,

as well as occasional visitors such as tourists. Occupants often have

unique customs, language, dress, rituals, and mannerisms that also

help define a community or neighborhood.

Some occupants may work hard to change a neighborhood based

on their ideas of what would make the neighborhood better. Not

surprisingly, promoting change, without stakeholder consensus, can

lead to conflict. Others may want to preserve a neighborhood by pre-

venting change. Preventing change is futile and may also lead to con-

flicts, particularly regarding newcomers seeking access to economic

opportunities. Change is inevitable. We can allow it to proceed based

on market forces, which are shaped predominantly by the affluent, or

we can attempt to manage it through government intervention. If we

attempt to manage it, we can manage it well or poorly depending on

our choice of goals and depending on how well we understand the

forces of change and the tools for guiding these forces.

A Tale of Two “Nations”

In the United States today, we seem to live in two different countries.

In one country, mostly in older industrial areas in the geographic

middle of the nation, factories and stores have closed. Housing is

cheap by national standards. But many people are unemployed or

working minimum-wage jobs. For them, even cheap housing can be