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Opinion | Edward L. Glaeser

Why income disparity in Boston isn’t a bad thing

THERE IS a deep economic division in Boston, just as there is in the country as a whole. Last week, the Boston Foundation released its annual Boston Indicators Report, which correctly reminds us that “the current configuration of the innovation economy is not working well for everyone, and, indeed, reinforces historic divides.’’ From 2006 to 2010, 15 percent of Boston families earned over $150,000 annually, while 28 percent of Boston’s children lived in poverty.

But while the inequality within a city can reflect the inequality of the nation, the two issues are fundamentally different. And in Boston’s case, inequality is as much a sign of urban strength as urban weakness.

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The report reminds us that Boston was once, like all of America’s older cities, a manufacturing powerhouse built around railroads and a port, and we had plenty of jobs for less educated workers. Those jobs disappeared, but Boston was able to escape the fate of Detroit because it had the educated workers who now power urban success. Per capita output in the most educated fourth of America’s metropolitan areas is $45,000, while per capita output in the least educated fourth of metropolitan areas is under $30,000. Boston’s per capita output is over $62,000.

Boston’s economic comeback did not, however, produce uniform prosperity. The Boston Foundation report wisely emphasizes the suffering in Roxbury, Dorchester, and Mattapan, “where the child poverty rate is 42 percent.’’ It is a tragedy that America sentences so many of its children to lives of deprivation, and the persistence of this problem has fueled the continuing debate about how much our system of taxes and entitlements should redistribute wealth.

But what inequality says about Boston is quite different. Cities attract poor people with the promise of economic opportunity, a more robust social safety net, and the ability to get around without a car. Poverty rates tend to rise near new subway stops not because subways impoverish local residents, but because poor people move near public transit.

More than one half of Boston’s population was born outside Massachusetts, and over 30 percent were born outside the United States. Almost one half of Boston’s foreigners were born in Latin America, and one quarter are Asian. We should celebrate the long-standing urban edge in integrating newcomers into America. Cities are good gateways for immigrants, and immigrants are good for cities. The diversity of Boston’s immigrants is visible in the restaurants popping up in city neighborhoods, whether serving Italian or Vietnamese.

Not all of Boston’s poor are upwardly mobile restaurateurs, of course. In many cases, poverty is multi-generational, and the city’s most deprived neighborhoods can feel oceans away from the region’s thriving information industries.

Yet we will achieve little in fighting poverty in Boston if we focus on the traditional tools of taxing and redistributing. Mayor James Michael Curley tried to right old wrongs by taking on the old Brahmin establishment, but he mostly managed to get them to leave the city. Local welfare states are easily stymied by the mobility of companies and wealthy taxpayers. The poverty in Dorchester calls for more redistribution by the federal government, not local ones; leaving the country is far more difficult than leaving the city.

The best way Bostonians can promote equality on the local level is to ensure that everyone has the skills needed to succeed in the information age. Only 41 percent of adult high school dropouts are currently employed, while 73 percent of college graduates are employed.

Boston is a great hub for education and technology, which makes the city an ideal breeding ground for ideas that can improve the educational prospects for disadvantaged children. If the Commonwealth seriously wants to fight inequality, it should do more for education-oriented start-ups that use new technologies to teach our children - and it should spend less money subsidizing, for instance, film companies. And if we can figure out how to teach better here, Boston will also be doing its part to fight equality on a national and global level.

Edward L. Glaeser, a professor of economics at Harvard University, is author of “The Triumph of the City.’’ His column appears regularly in the Globe.
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