Fostering Prosperity at the Local Scale: Outcomes of Urban Policy for Deprived Neighbourhoods in Germany

Abstract

Traditional urban policy focuses mainly on redevelopment measures. Germany’s Social City programme incorporates urban regeneration with support to local communities in deprived neighbourhoods. We use microdata on household characteristics from the German Socio-Economic Panel (SOEP) and microdata on housing prices from the RWI GEO-RED to assess the policy effects on household income and housing markets. Drawing on propensity score matching, we find that household incomes among programme areas have not been affected. However, hedonic pricing models reveal significant effects on housing prices and rents.