Ward-Level Deprivation and Individual Social and Economic Outcomes in the British Household Panel Study

Abstract

Recent government policy in the United Kingdom has attached particular importance to the spatial concentration of deprived households within urban areas (Edwards, 1997). The Labour government is formally committed to tackling poverty, unemployment, and social exclusion and sees an important role for area-based policies reaching beyond the traditional urban or inner-cities policy remit in dealing with some of these problems (Social Exclusion Unit, 1998). The government's New Deals are primarily aimed at groups of individuals with high rates of joblessness. The New Deal for Communities aims to regenerate the most deprived areas through improving job opportunities, reducing crime, increasing levels of education, and reducing poor health. Seventeen pilot areas have already been chosen for the initiative and more will follow. In addition, various government departments have launched their own area-based initiatives including Employment Zones, Education Action Zones, and Health Action Zones. Much political debate has focused on the problem of coordinating all of this activity. However, behind these initiatives lies a decade-long debate over how effective area-based policies can actually be and it is this debate which is reflected in this paper.Understanding the extent to which deprivation measured at the area level can explain the variation in social and economic problems between areas is clearly a key issue in assessing whether or not specific area targeting is a sensible option (Kleinman, 1999;Macintyre et al, 1993). The underlying rationale of area-based policies is that concentrations of deprivation give rise to problems greater than the sum of its parts. So individuals with characteristics likely to put them at high risk of experiencing adverse social and economic outcomes are further disadvantaged if they live in neighbourhoods where there is a high concentration of people with similar characteristics. A compositional explanation for observed area variations in social and economic problems argues that areas of concentrated disadvantage arise solely because of the varying distribution

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