An evaluation of economic benefits of gentrification in St. Paul, Minnesota

Chuang, Hun-Zue
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The purpose of this study is to answer the question of whether the process of gentrification provides economic benefits to the city. The study assumed that cities derive economic benefits from gentrification. First, the study classified St. Paul census tracts into gentrified and non-gentrified areas. Selection of indicators relied on the core definition of gentrification, that is, "class transformation." Therefore, education and occupation were selected as proxy indicators for gentrification. Then, housing values, employment, and family incomes were used as indicators of gentrification-derived benefits. By examining census data from 1970 to 1990 and using a t-test, the relationship between gentrification and median family incomes was confirmed. However, the data did not support a relationship between employment and gentrification. Only when employing the educational indicator in the first period of 1970-1980, did the result of the test indicate that a change in employment rate was associated with gentrification. For the relationship between median housing values and gentrification, the results were different for the two periods of 1970-1980 and 1980-1990. In the first period, the change in median housing values was significantly different for gentrified and non-gentrified tracts. This difference faded away when gentrification was defined by occupation and "both" indicators during 1980 and 1990 (the second period). In conclusion, the analysis documents that gentrification indeed has generated some economic benefits for the city of St. Paul.

Community and regional planning