Empowering the Impoverished: Fed Economist Discusses Development Research

By Justin Wier


Dionissi Aliprantis, research economist with the Federal Reserve Bank of Cleveland, spoke to students on Wednesday during an event presented by PAYO: Poverty Awareness in Youngstown in coordination with the Economics Club.


Ashley Orr, co-founder of PAYO, worked with Aliprantis during an internship at the Federal Reserve Bank in Cleveland during the summer of 2014.


“I think his work is very inspiring, and he’s doing a lot of good work in the field of economics,” Orr said during her introductory remarks.


Aliprantis said he was drawn to poverty because he wanted to do something to alleviate human suffering, but he said the fundamental question for him revolves around development.


“How does it inhibit people’s development and their reaching their potential?” he asked.


Aliprantis began by talking about his time spent in Haiti evaluating the most effective ways to provide wells to the country’s citizens. He described a model in which citizens are responsible for funding the maintenance of their own wells.


“When I was in grad school, I was really against this approach,” Aliprantis said. “There was this issue in the back of my mind that you might be excluding poor people from access to these wells.”


An organization called Haiti Outreach began experimenting with the method in situations where the wells otherwise would not have been constructed. They found it to be extremely effective in making sure the wells continue to function.


Aliprantis created a model that showed the community-based approach provides more functional wells to poor communities than the traditional foreign-aid approach.


He said his experiences in Haiti led him to consider poverty in his own country while he was working in Philadelphia.


“I thought, man these rich people that live here, I’m going to the poor neighborhoods in their city and they’ve never been here,” Aliprantis said. “Then I realized, ‘Have I ever been to North Philly before?’”


He showed maps documenting extreme segregation in American cities in 2010, focusing on Cleveland, Chicago and Detroit. He showed a statistic documenting that 26 percent of black Americans under the age of 10 have witnessed someone being shot at.


“If you start digging into that, it’s really, really predictive of all kinds of outcomes you don’t want,” Aliprantis said. “How do we protect our kids and spare them from that kind of exposure?”


He talked about past arguments about whether these outcomes were structural or genetic, until William Julius Wilson determined it stemmed from neighborhood effects.


He talked about public housing in Chicago, which was primarily being built in black neighborhoods. This led to the creation of the Section 8 program in Chicago, which drastically improved outcomes in educational attainment and employment.


The Clinton administration drawing on Wilson’s research tried it in five different cities, but the effects in Chicago were not repeated. People interpreted this to mean neighborhood effects weren’t real.


Aliprantis said he and others found that they were equating neighborhood quality to poverty. While poverty rates improved, things like educational attainment and employment rates within the neighborhoods were more or less the same as the neighborhoods they left.


“People essentially moved from the worst neighborhoods in the country, to bad neighborhoods,” Aliprantis said. “The poverty rate in a neighborhood doesn’t totally capture the neighborhood quality.”


He closed by talking about Math Corps, a summer math camp started in Detroit that Aliprantis helped bring to Cleveland. They use non-traditional incentives to encourage kids to engage with one another.


Orr said she wanted Aliprantis to speak at Youngstown State University because the issues he addresses are relevant to the city.


“I wanted him here to bring that academic discourse to a topic that is sometimes really emotionalized,” Orr said. “Poverty really can be, but there’s a lot of really good academic work being done in the field.”


She said the heart of Aliprantis’s research is about caring for others, which resonates with people in all fields.


“I care about poverty because of human suffering,” Orr said. “I can’t live without working on that problem, so I really share his values on that. I think a lot of us, regardless of whether we’re working in poverty problems or not share that value too. We want to care.”