Lecture 10 Summary 2012.pdf

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Economics for Management Studies

Lecture  10  Summary  Social  Polarization  and  Environmental  Racism   March  20,  2012     TODAY   • Spatial  divisions  in  the  city   • Spatial  Sorting  Processes   • Poverty  and  the  city   • Socio-­‐spatial  polarization   • Race  and  Space   • Good  and  Bad  Quality  Environments   • LULUs   • Environmental  Racism     Spatial  Divisions  in  the  City   Cities  are  spatially  differentiated,  meaning  that  they  are  different  in  different  places,   with  varied  patterns  of  population,  housing,  rents,  land  costs,  etc,  for  different  areas.   This  is  a  result  of  multiple  factors,  including:  Geography,  Topography,  Accessibility,     and  the  degree  of  Amenity  in  different  locations  (quality  of  local  environment  and   services,  e.g.  Fresh  air,  good  views,  lots  of  green,  good  transport  systems,  good   schools  and  other  services).  A  key  urban  process  is  the  sorting  of  people  into   different  parts  of  the  city   There  are  a  number  of  different  sorting  processes  that  are  common  in  cities:   –By  wealth   –By  race  and  ethnicity   –Buy  occupation   –By  age   –By  sexual  preference     Probably  the  most  powerful  sorting  process  in  our  society  is  by  wealth.  High   amenity  areas  are  more  expensive  to  live  in  because  wealthy  people  bid  up  the  price   of  space  in  high  amenity  areas.  This  is  often  seen  as  a  normal  and  natural  aspect  of   capitalist  property  markets,  to  the  extent  that  it  is  seldom  questioned,  but  it  has   huge  consequences  historically  and  today  for  cities,  and  residential  patterns  in   cities.     What  sort  of  consequences?   The  wealthy  increasingly  live  in  clusters  of  rich  people,  poor  live  in  areas  of  poor   people.  Also,  the  wealthy  have  a  way  of  choosing  the  nicest  locations,  and  will  invest   to  improve  them,  whereas  the  poor  tend  to  live  in  areas  with  worse  environments,   because  they  are  cheaper.  That  is,  they  are  locations  where  the  rich  don’t  want  to   live.  A  major  problem  here  is  that  neighborhood  quality  is  self-­‐reinforcing  –  rich   people  are  much  more  likely  to  benefit  from  rising  property  values  than  poor   people,  if  each  invest  an  equal  share  of  their  income  in  their  housing.  But  also  poor   residents  are  much  more  likely  to  suffer  from  place-­‐related  multiple  deprivation,   adverse  health  consequences  of  poor  environments,  less  access  to  jobs,  worse   schools,  etc.  These  sorts  of  positive  feedback  effects  of  local  environments  on  health,     1   on  schooling,  on  life  opportunities,  etc.  are  pervasive  in  cities,  and  are  a  major   research  subject  of  urban  geographers.     Patterns  of  population  sorting  by  wealth  in  Toronto   This  section  is  largely  based  on  the  research  report  by  Prof.  David  Hulchanski,   available  on  the  CUCS  website  here:  http://www.urbancentre.utoronto.ca/   Scroll  down  the  page  a  little  to  the  link:    Research Bulletin & Neighbourhood Maps The Three Cities Within Toronto: Income polarization, 1970–2000 by J.D. Hulchanski. These  maps  show  a  dramatic  and  rapid  process  of  socio-­‐spatial  polarization  from   1970  to  2000.  That  is,  the  wealthy  areas  are  getting  wealthier,  and  the  poor  areas   are  getting  poorer,  and  the  middle  is  shrinking.  Perhaps  the  most  remarkable   finding    of  the  Hulchanski  research  is  the  amazing  consistency  in  the  direction  of   change  of  different  neighbourhoods,  with  many  rich  neigbourhoods  increasing  their   share  of  wealth  every  census  period  since  1970,  and  many  others  getting  poorer   every  census  period  since  1970.       This  change  is,  of  course  a  part  of  larger  processes  of  Income  polarization  -­‐  the   increasing  divide  between  rich  and  poor,  and  the  shrinking  middle  class  –  in  our   society.  This  growing  divide  was  an  important  motivation  of  the  ‘Occupy’   movements  of  2011.     Linda  McQuaig  argued  in  a  Toronto  Star  article:  (Toronto  Star,  Tuesday  Nov  16,   2010,  pg  A23)   ‘North American capitalism has changed dramatically in the last few decades. While a tiny elite always dominated, the benefits of economic growth were much more widely shared prior to 1980. Whereas the top 1 per cent captured 9 per cent of the U.S. national income a few decades ago, today they capture an astonishing 24 per cent. (Similarly, in Canada, while the top 1 per cent captured 7 per cent of national income a few decades ago, today their share has risen to 14 per cent.) But while progressives argue for a better deal for the poor and middle class, they increasingly shy away from directly challenging the growing wealth concentration at the top and the ferocious political forces supporting that privileged elite . But extreme wealth concentration isn’t just a side issue; it’s the root of the problem. Such wealth confers enormous political clout, giving the super -rich the power to block income redistribution efforts and to knock down financial regulations, opening the door to disastrous Wall Street crashes like the recent one we’re still reeling from. Indeed, such concentrated economic power undermines democracy itself. As the late U.S. Supreme Court Justice Louis Brandeis noted: “We can have democracy . . . or we can have great wealth concentrated in the hands of a few. We cannot have both.” ‘   (OK,  so  I  included  a  bit  more  of  the  editorial  than  is  specifically  relevant  here,  but  it   is  very  well  written!).  The  point  is,  income  polarization  is  a  key  fact  of  our  society.  It   is  not  just  Toronto  neighborhoods  that  are  increasingly  divided  between  rich  and   poor,  but  our  society  as  a  whole.         2   The  geographical  point  is  that  increasing  income  polarization  is  reflected   spatially.  There  are  very  significant  sorting  processes  in  Toronto,  that  are  driven   largely  by  market  forces  (differences  in  prices  for  housing  in  different  areas).     • Wealth  is  clearly  a  powerful  factor  that  is  sorting  out  population  into   different  spaces  in  Toronto   • Spatial  sorting  by  income  is  clearly  extremely  powerful  and  dynamic   • These  changes  are  extremely  rapid   • The  degree  of  consistent  change  in  particular  neighborhoods  is  dramatic     Should  we  be  concerned?  It  is  worth  asking:  what  kinds  of  issues  do  these  patterns   raise?  What  kind  of  a  city  will  result  if  this  trend  continues?  What  is  the  impact
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