Paper

Do Inclusionary Housing Policies Promote Housing Affordability? Evidence from the Palmer Decision in California

Ann Hollingshead

Many cities have responded to rising affordability challenges with inclusionary housing policies, where a municipality requires or incentivizes a developer building a new development to contribute affordable housing units or pay a fee. While the aim of these policies is to promote housing affordability, some critics have raised concerns about their potential unintended market consequences. Specifically, to the extent that inclusionary housing policies create opportunity costs for developers and function like a tax on housing supply, they may stifle housing production and increase the price of market-rate units, reducing overall affordability. However, inclusionary policies may also increase the supply of affordable housing, which would place downward pressure on prices. This paper examines these relationships using the 2009 ruling by California’s Second District of Appeal, Palmer/Sixth Street Properties LP v. City of Los Angeles, which substantially weakened inclusionary housing policies in the rental market. This analysis fails to find evidence that weakening an inclusionary policy is associated with a decrease in the rental price of high-cost housing units. Meanwhile, these results also suggest that inclusionary housing policies pre-Palmer, in general, did promote housing affordability in the low-cost market. 

Worker Cooperatives in a Globalizing World

Allen White and Josu Ugarte

The Mondragon Corporation, based in the Basque Region of Spain, is a renowned worker-owned multinational cooperative enterprise founded in 1956 on the principle of “worker sovereignty.” Allen White, Senior Fellow at Tellus Institute, explores the credo, strategy, and promise of global cooperative enterprises with Josu Ugarte, former president of Mondragon International. 

Worker Cooperative Industry Research Series: Craft Beer

Tim Palmer

The craft brewing industry presents an interesting possible route to scale for worker cooperative development. The industry, incredibly, is still growing after more than two decades of upward trends. Moreover, the independent and artisan workplace culture fostered by owners and workers alike has made some rms more receptive to employee ownership. The success of Black Star Brewery and Pub Co-Op, as well as the ESOP-owned New Belgium Brewing Company provide models for replication and education. Worker cooperative developer participation in this industry has been minimal to date, though a sustained focus here could make an important impact. 

Promoting Opportunity through Equitable Transit-Oriented Development (eTOD): Making the Case

John Hersey and Michael A. Spotts

Promoting Opportunity through Equitable TOD: Making the Case, the first of three reports that cover different aspects of eTOD, provides a non-exhaustive review of the evidence and literature that demonstrates the importance of eTOD. A second report will illustrate barriers to eTOD and best practices for overcoming them, while the third will address the federal role in supporting eTOD. 

Policy Change for Local Living Economies: Practical Strategies for Champions of Change

David Brodwin

The work of building a vibrant local economy requires up-to-date government policies and responsive government processes. This report offers suggestions for would-be change agents to identify the best initiatives and work with local governments on their implementation. 

Risk, Return and Impact: Understanding Diversification and Performance Within an Impact Investing Portfolio

Jed Emerson

This brief offers impact investors a review of key considerations concerning risk, return and impact when constructing an impact portfolio. Various types of risk are identified along with a review of the “New Efficient Frontier” and the types of impact investing options that may be arrayed across a range of financial, social and environmental returns. 

Measuring Impact and Non-financial Returns in Impact Investing: A Critical Overview of Concepts and Practice

Neil Reeder and Andrea Colantonio

This paper draws on a range of relevant literature as well as the authors’ previous practical experience to provide a preliminary overview of underlying concepts. Further it begins to cast a critical eye on the roles and responsibilities within measurement, making more explicit the subjective interpretation of social and environmental return (SER) by investors, and the clash of suppositions taken from other older measurement traditions. In doing so, the paper investigates some of the tensions around breadth of coverage, participation and objectivity, rigour and flexibility, attribution of impact, and the very concept of ‘a return’ itself which currently surround practical measurement. 

In this context, the paper shows how measurement does not yet appear to have found a pragmatic, participative, systematic way forward, and concludes by identifying key research areas that need to be addressed to advance knowledge in this field. Further empirical data collection and analysis will be undertaken in a subsequent series of papers to be published. 

Tipping the Scale: How Assets Shape Economic Wellbeing for Women and Families

Rebecca Loya, Alexis Mann, Janet Boguslaw and Thomas Shapiro

The present analysis draws on interviews with black and white families of diverse means to illustrate how resource differences play out in the lives of American families. We contrast the options and experiences of higher-resource families like the Barrys, who have access to two or more resources at the personal, institutional, or neighborhood levels, with those who have fewer resources, like the Meehans. This brief focuses on women’s experiences speci cally and considers how women of different racial backgrounds with various income and asset pro les manage these economic challenges. 

Saving 10x for Education: The Impact of EARN’s Triple Boost Microsavings Program on Families’ Education Savings

Jade Shipman

EARN is a leading nonprofit provider of microsavings programs in the US. EARN commissioned a Randomized Controlled Trial (RCT) to measure the impacts of TripleBoost, a program designed to help working families save for their children’s education. The primary goal of the RCT was to understand how the first 6 months of TripleBoost participation influences the amount of money that families save for their children’s education.

To answer this question, the study randomly placed qualified TripleBoost applicants into Treatment and Control groups, where the Treatment group immediately began participation in TripleBoost, and the Control group was placed on a 6month waiting list. Families were asked a series of questions at the time of application and on a 6month followup survey. Actual deposit data from families in the Treatment group also was analyzed.

RCT findings reveal that during the 6month study period, TripleBoost families saved an average of $681 for their children’s education, more than 10 times the average amount saved by families in the Control group. A majority of families in the Control group saved $0 during the study period, while 90% of TripleBoost families saved $500 or more. The results are statistically significant. Thus, EARN’s TripleBoost program effectively drives families to set aside 10x more in savings for their children’s education than they would save without the program. 

Federal EITC Kept 2 Percent of the Population Out of Poverty: Greatest Poverty Reductions in Texas, North Carolina, and Arizona

Douglas J. Gagnon, Marybeth J. Mattingly and Andrew Schaefer
University of New Hampshire

This brief documents the proportion of Americans who would have been poor absent the Earned Income Tax Credit (EITC), all else being equal, across 2010–2014. We examine Supplemental Poverty Measure (SPM) rates as well as hypothetical increases in the rates of SPM poverty in the absence of federal EITC benefits. It is important to note that we do not model behavioral changes that might result from the removal of EITC benefits, so the analyses presented here are a simplified representation of such a hypothetical scenario. The SPM is an obvious choice for this analysis because unlike the Official Poverty Measure (OPM), which only accounts for before-tax cash income, the SPM also considers in-kind benefits, tax credits, and out-of-pocket work and medical expenses when estimating resources. We present SPM rates for all individuals as well as for children only, analyzing trends across regions, metropolitan status, and by state. Importantly, geographic differences in the cost of housing are accounted for in the SPM rates, and consequently the analyses presented here give a more accurate sense of the poverty reducing impact of EITC benefits. 

Fossil-Free Investment for a Just Appalachian Transition: Obstacles and Opportunities

Joshua Humphreys, Becky Johnson, Kristin Lang, David Roswell and Sandra Korn

This paper, commissioned by the Mountain Association for Community Economic Development (MACED), explores the relevance of divestment for the Appalachian Transition. The paper provides background on divestment trends as well as insights into the diverse ways that various kinds of investors are approaching fossil-fuel divestment and fossil-free reinvestment. Over the course of this inquiry, which began in late January 2014, we have reached out to nearly three dozen different investors and their advisers, interviewing investment decision-makers from 18 institutions and firms that are grappling with fossil-fuel divestment and are interested in the idea of reinvesting in Appalachia. We focused our outreach primarily on foundations, faith-based investors, financial advisers working with individual clients, and investment consultants and impact investment firms working with institutional investors. Based on this research and outreach, we analyze the potential opportunity that divestment presents for place-based reinvestment into frontline communities in the region. While we found considerable interest in investing in the region to support the transition, numerous obstacles stand in investors’ way. We therefore identify many of the leading obstacles and make several recommendations for overcoming them. 

 

Public Sector Jobs: Opportunities for Advancing Racial Equity

Julie Nelson and Syreeta Tyrell

Years of organizing within the Civil Rights Movement led to the eventual passage of the Civil Rights Act of 1964, with Title VII containing prohibitions of discrimination in the workplace on the basis of race and other protected classes. This accomplishment provided tools for the enforcement of illegal discrimination laws and has reduced many explicitly discriminatory behaviors over the past half a century. However, racial inequities continue to persist across all indicators for success in the United Sates. For local and regional government focused on achieving racial equity in our communities, “walking the talk” within one’s own institution and workforce is an important place to focus. 

Building a More Inclusive National Park System for All Americans

Nidhi Thakar, Claire Moser and Laura E. Durso

Work remains to build a system of national parks and monuments that tells the stories of all Americans by reflecting the full scope of the nation’s history and meeting the demands of a diverse population. 

State Future Funds: Jumpstarting Investments in Low-Carbon and Resilient Energy and Transportation Infrastructure

Cathleen Kelly

The reality is that state and local governments—and communities—are on the front lines when it comes to coping with crumbling and outdated infrastructure, traffic congestion, air pollution, more extreme weather driven by climate change, and growing inequities. Congress has the power to provide state and local officials with a remedy to the pressing on-the-ground challenges they confront daily. Specifically, by creating State Future Funds, Congress can support state and local efforts to build low-carbon and resilient infrastructure, strengthen communities and grow opportunities for all to prosper. 

Job Creation for the Disadvantaged: A Review of State and Local Efforts

Karen Chapple and Robert P. Giloth

This paper examines current job creation practices, surveying the federal government response, think-tank proposals, and related programs in all fifty states. Given the failure of most to reach the least advantaged communities, we then propose an alternative set of approaches in three areas: sectoral strategies, entrepreneurship, and tax and employment policy. A conclusion discusses the challenge of generating and implementing new ideas for job creation. 

Community Supported Agriculture: A Model for the Farmer and the Community?

Mark Paul
Economics for Equity and the Environment Network

This case study provides an analysis and evaluation of Community Supported Agriculture (CSA). To examine CSA as a potentially viable Future Economy Initiative, interviews, a survey, and secondary data sources were utilized. From May 2014 to October 2014 16 in-person semi-structured interviews with CSA farmers were conducted across three counties in Western Massachusetts. A copy of the interview and survey can be found in the appendix. There have been few comprehensive efforts to analyze CSA across the United States, however this study provides an overview of the CSA and the resulting economic, social, and environmental outcomes. 

Growing in Place: Building a Local Food Economy in Vermont

Kathryn A. Olson
Economics for Equity and the Environment Network

The local food movement has been gaining momentum in the United States, with farmers’ markets and new direct-to-consumer arrangements such as Community Supported Agriculture (CSAs) gaining in popularity. Yet while proponents of local food point to its environmental, economic, and social benefits, little research has investigated the impact of local food on community wellbeing. Vermont leads the country in farm stands, direct-to-consumer sales, and farmers’ markets per capita and the town of Hardwick has received attention for its growing economy based on new food and agriculture businesses. This project applied a multi-disciplinary methodology to assess the impact of a local food economy on the environmental, economic, and social wellbeing of the community. 

Family Financial Resources among Boston Residents: Flow by Race and Ethnicity

Tatjana Meschede, William Darity Jr. and Darrick Hamilton

This issue brief examines the extent to which family financial transfers occur among Boston residents of color. New data collected for the Boston metro area, as part of the National Asset Scorecard for Communities of Color (NASCC) survey, for the first time provide detailed information on financial assets that allow analysis to be broken down beyond the traditional black-and-white divide at the metropolitan-area level. Targeting U.S.-born blacks, Caribbean blacks, Cape Verdeans, Puerto Ricans, and Dominicans, findings show that households of color consistently receive fewer financial transfers than whites, while at the same time providing more financial assistance to their families and relatives. Particularly striking are differences in parental payments toward higher education expenses and financial support for the down payment of a home. Immigrant status further explains differences between white and nonwhite households as well as between households of color. 

Building Millenials' Financial Health Via Financial Capability

Terri Friedline and Stacia West

This study, generously funded by the FINRA Investor Education Foundation, leveraged the 2012 National Financial Capability Study (NFCS) to investigate the state of Millennials' financial health and to provide a preliminary test of the effectiveness of financial capability—an intervention that has the potential to improve financial health by combining financial education and financial inclusion. In particular, this study asked whether being financially capable was associated with metrics of Millennials' financial health such as locating $2,000 for an unexpected expense, saving for emergencies, using alternative financial services, carrying too much debt, and being satisfied with their financial condition. In addition to joining the national dialogue regarding the state of Millennials’ financial health within the current macroeconomic context, this study offers financial capability as a potential solution. 

Poverty Interrupted: Applying Behavioral Science to the Context of Chronic Scarcity

Allison Daminger, Jonathan Hayes, Anthony Barrows and Josh Wright

Ideas42 has engaged with more than 70 domestic poverty experts over the past year, including academics, practitioners, and parents raising young children. We have studied academic liter- ature from multiple disciplines and directly observed 15 programs serving families with low incomes. This paper distills the lessons we’ve learned and the best practices we've observed in this process. We do not claim exhaustive knowledge of poverty; instead, we intend this document to serve as a well-researched conversation starter that will help catalyze the behav- ioral innovations our society desperately needs. In the pages that follow, we share behavioral insights that shed new light on the many challenges facing families with low incomes and those who seek to support them. We also put forward three design principles that follow from these insights and can be tailored to t the needs of a wide range of communities, organizations, policies and programs.