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Last spring, the 18-member 2020-21 class of Institute Visiting Scholars was named. Some established, some emerging, they bring a diversity of backgrounds and research interests as they examine what sorts of policies work to improve economic opportunity and inclusion, and why.
When Milena Almagro began studying at New York University in 2014, she lived in Brooklyn’s ultrahip Williamsburg neighborhood. Finding it too gentrified to afford, she moved to Bushwick, a less-hip adjoining neighborhood.
But Bushwick also was gentrifying. Latino families were moving out, and childless young professionals were moving in—people like her, in other words.
“I was a gentrifier,” Almagro said. “Just seeing that transformation got me thinking about urban change and the welfare implications of urban change.”
Almagro and her NYU colleague Tomás Domínguez-Iino studied the impact and proliferation of short-term rentals, such as Airbnb. That's a disruption not unlike gentrification. Looking at Amsterdam, Netherlands, they used detailed data to build a unique model.
Others studying the same phenomenon have only modeled housing, but Almagro also modeled businesses providing the goods and services that make neighborhoods desirable and how different demographics reacted to changes in both.
A classic example is day care centers, which serve residents, being replaced by bars, which benefit from tourism. While the model showed rents rising for residents competing with the likes of Airbnb, some suffer more because they can’t afford to be close to day care providers that remain, some suffer less because they can afford it, and some not at all because, being childless, they gain more from an active nightlife.
The magazine of the opportunity & Inclusive Growth institute
More importantly, Almagro’s model could be used to evaluate policies aimed at reducing disruption from short-term rentals. She found, for example, that higher lodging taxes weren’t as effective as capping the number of nights tourists can rent a home.
More recently, interest in urban change inspired Almagro to examine why the rate New Yorkers tested positive for COVID-19 was much higher in poorer, minority neighborhoods. The greatest correlation, she found, wasn’t poverty or race but certain jobs requiring more human contact, such as bus driver, where these demographics are overrepresented.
That connection between jobs and infection risks suggests that authorities could better prevent the spread of COVID-19 by giving these workers, not just health care workers, priority for protective gear and testing.
These are the kinds of practical problems that made economics an appealing field to Almagro. “Most of my research,” she said, “comes from what I see in real life.”
This article is featured in the Fall 2020 issue of For All, the magazine of the Opportunity & Inclusive Growth Institute
More Scholar Spotlights from this issue
Tu-Uyen Tran is the senior writer in the Minneapolis Fed’s Public Affairs department. He specializes in deeply reported, data-driven articles. Before joining the Bank in 2018, Tu-Uyen was an editor and reporter in Fargo, Grand Forks, and Seattle.
