Why Is the East Side Poorer than the West Side?

A new paper suggests that pollution (and prevailing winds) may be part of the answer.

The east side of once-industrialized cities is often poorer than the west side. Why would this be? A new paper in the Journal of Political Economy suggests that air pollution is part of the answer.

In "East-Side Story: Historical Pollution and Persistent Neighborhood Sorting,"
Stephan Heblich, Alex Trew, and Yanos Zylberberg make the case that the difference in economic performance between the east and west sides of formerly industrialized cities is due, at least in part, to the fact that the east side of such cities suffered more air pollution than did the west side because of prevailing winds. This produced a wealth gap -- or, as they put it, relative differences in economic deprivation -- that persist today, even after the adoption of air pollution controls.

From the paper's introduction:

Cities that were formerly reliant on industry tend today to have eastern suburbs that are notably poorer than their western suburbs. This observation is echoed in media stories about the east side of London, New York, or Paris and in popular culture (such as in the long-running BBC soap opera EastEnders). We show that the east-west gradient is partially a remnant of the distribution of the atmospheric pollution that affected cities during the Industrial Revolution. Pollution from historical factories accounted for about 15% of the variation in neighborhood composition in 1881. There is no evidence of excess deprivation in neighborhoods downwind from industrial chimneys before the rise of industrial coal in 1817. Industrial coal pollution effectively stopped in the 1970s, but the path dependence in neighborhood sorting is still felt today.

And from the conclusion:

This paper presents a plausible explanation for what was, until now, an anecdotal observation that the east sides of formerly industrial cities in the Western Hemisphere tend to be poorer than the west sides. With rising coal use in the heyday of industrialization, pollution became a major environmental disamenity in cities. An unequal distribution of pollution exposure induced a sorting process that left lower classes in polluted neighborhoods. Our empirical analysis relies on precise pollution estimates and identifies neighborhood sorting at a highly local level: the east/west gradient reflects a drift in pollution at the city level, but the relationship between atmospheric pollution and neighborhood composition materializes at a much more local level.

As for the implications of this research, the authors offer some observations:

Our findings hold at least two important implications. First, the success of urban policies to revitalize deprived areas may depend on the initial level of deprivation. As suggested by our findings, very deprived neighborhoods may need a larger push to attract richer residents. This observation leads to a second implication for countries such as China where pollution currently presents a major challenge. Besides the well-documented short-run effects of pollution exposure on health, there are long-run consequences of uneven pollution exposure across space: pollution induces spatial inequalities that far outlive deindustrialization.

Interesting stuff!