Quantifying Jacobs: More Vitality, Less Poverty

Abstract

In the absence of public policy, residential segregation has a fundamental capacity to define the form and function of cities in Latin America. Neighborhoods have distinctive characteristics that are active attributes when they contribute to perpetuating the social class that inhabits them. While Latin American cities naturally tend to fractionalize along Moses' functionalist model, we study the extent to which diversity, the cornerstone of Jacobs' urban urban vitality, could contribute to improving the quality of life in cities. We study the incidence of business diversity, measured by the variety of business sizes in an area, on socio-economic status in the city of Quito. The hypothesis is that the diversity of business sizes in a neighborhood increases socio-economic status. A spatial analysis model (SAR) with a Ordinary Least Squares (OLS) model was estimated in order to capture the spatial contagion that produces the percentage of vulnerability in Quito's neighborhoods. The result found is positive and statistically significant, which indicates that the vulnerability percentage of a neighborhood depends positively on that of neighboring neighborhoods. We also found a negative effect on the vulnerability percentage with an increase in business diversity.