ECONOMIC REPORT OF THE PRESIDENT

Figure 4-21
Average Annual Earnings in Adulthood Among Children Younger than 13
When Their Family Participated in MTO, 2008—2012
2012 U.S. Dollars
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
11,270
12,994
(15% Increase)
14,747
(31% Increase)
0
Control Section 8 Experiment
Note: MTO stands for the Moving to Opportunity experiment.
Source: Chetty, Hendren, and Katz (2015).
Housing and Neighborhoods
Moving to a lower-poverty neighborhood as a child can have a profound
impact on multiple health and human capital outcomes, both in the
short term and long term. These impacts are driven in part by changes in
the availability of health and human capital inputs reviewed earlier in this
chapter, and in part due to related changes in peer effects, crime, safety, and
other environmental factors.
Compelling evidence that the opportunity to move to a better neighborhood
can dramatically impact children’s lives comes from a randomized
controlled trial conducted in the mid-1990s known as the Moving to
Opportunity program (MTO). MTO allowed researchers to evaluate the
impact of both conventional Section 8 housing vouchers, which do not place
any geographic restrictions on where recipients can live, and experimental
vouchers that required families to move to lower-poverty neighborhoods for
at least one year.
A new study by Chetty, Hendren, and Katz (forthcoming), which
is the first to look at adult outcomes for children whose parents received
housing vouchers, finds remarkably large benefits—especially when voucher
receipt was contingent on moving to a low-poverty neighborhood. Among
children who were younger than 13 when their families moved, Section 8
vouchers increased adult earnings by 15 percent and experimental vouchers
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