Measuring Gentrification: Using Yelp Data to Quantify Neighborhood Change

32 Pages Posted: 17 Sep 2018  

Edward L. Glaeser

Harvard University - Department of Economics; Brookings Institution; National Bureau of Economic Research (NBER)

Hyunjin Kim

Harvard Business School

Michael Luca

Harvard Business School

Date Written: August 2018

Abstract

We demonstrate that data from digital platforms such as Yelp have the potential to improve our understanding of gentrification, both by providing data in close to real time (i.e. nowcasting and forecasting) and by providing additional context about how the local economy is changing. Combining Yelp and Census data, we find that gentrification, as measured by changes in the educational, age, and racial composition within a ZIP code, is strongly associated with increases in the numbers of grocery stores, cafes, restaurants, and bars, with little evidence of crowd-out of other categories of businesses. We also find that changes in the local business landscape is a leading indicator of housing price changes, and that the entry of Starbucks (and coffee shops more generally) into a neighborhood predicts gentrification. Each additional Starbucks that enters a zip code is associated with a 0.5% increase in housing prices.

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Suggested Citation

Glaeser, Edward L. and Kim, Hyunjin and Luca, Michael, Measuring Gentrification: Using Yelp Data to Quantify Neighborhood Change (August 2018). NBER Working Paper No. w24952. Available at SSRN: https://ssrn.com/abstract=3244234

Edward L. Glaeser (Contact Author)

Harvard University - Department of Economics ( email )

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Hyunjin Kim

Harvard Business School ( email )

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Michael Luca

Harvard Business School ( email )

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