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A cynic would attribute the disparity (and the failures to gentrify) to indifference or inattention, (or worse) disdaining neglect or ignoring, by the politicians and rich of the poor in the poor areas.

I exemplify with cities whose disparities I have witnessed, followed by links to the maps overlaying location with income, but I exclude downtown areas which always appear rich:

New York: (Lower) Manhattan vs. The Bronx and Brooklyn (e.g. Bedford-Stuyvesant, Bushwick) <Google search: 1, 2>

London (Boroughs): Hammersmith & Fulham, Kensington & Chelsea, Westminster
vs. Hackney, Tower Hamlets, and the southern boroughs like Lewisham, Croydon.
<Google search: 3, 4, 5>

Toronto: Midtown (along Yonge St. subway line, like Lawrence Park) vs. Jane & Finch, Rexdale <Google search: 6>

Vancouver: West & North Vancouver, West Side, South Vancouver vs. Downtown East Side, Surrey
<Google search: the Vancouver Sun has many maps.>

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  • $\begingroup$ Are you asking: 1) Why is there poverty in rich cities? OR 2) Given that there is poverty in rich cities, why do poor people tend to be concentrated in particular areas? $\endgroup$ – Adam Bailey Nov 13 '16 at 11:59
  • $\begingroup$ @AdamBailey I meant 1) Why is there poverty in rich cities?, and not 2. (2 itself is a good question, but should I allow you to pose it as you raised it?) $\endgroup$ – Greek - Area 51 Proposal Nov 13 '16 at 12:02
  • $\begingroup$ Please feel free to ask 2 as a separate question if you wish. $\endgroup$ – Adam Bailey Nov 13 '16 at 12:25
  • $\begingroup$ If rich cities were homogeneous then poor people could not afford to live in them. $\endgroup$ – Henry Nov 14 '16 at 8:30
  • $\begingroup$ How will be rich know they are rich if they don't have poverty in their midst? $\endgroup$ – James Jan 19 '17 at 18:56
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Regarding NYC, it has mostly to do with public housing and rent stabilization.

Here's a map of public housing in NYC. Notice the large public housing developments in lower Manhattan, The Bronx, and Bushwick.

About half of all apartments in NYC are rent stabilized, and these apartments tend to be priced at a fraction of the market value and inhabited by tenants who never move (because then they'd lose their precious deals). Thus rents in NYC have a bimodal distribution.

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Consider how urban agglomeration works. As you move closer to the city center where more jobs are available, rents become more expensive per square foot. So different types of job markets will form in different areas based on transportation costs to the city center. Usually that means different income groups will live in different areas, but of course, peoples' wages are not homogenous, and neither are job markets based on just distance from the city center.

This is especially true now that the costs of transportation have become much smaller, and we start to see urban sprawl as people decide the negative externalities of living in a highly agglomerated area (crime, pollution, etc.) distort their decision on where to live. Equally so, positive externalities like additional amenities to only single regions of a city can distort incentives, and lead to things like gentrification, where the poor are displaced from the region due to higher rents and forced to find a region that is less well off to live in.

There could be sociological reasons for wide variances in income in tightly packed, well defined areas. Schelling's segregation model tells us that people self segregate even with a preference for diversity, because the preference for to be with those like ourselves is powerful. So ethnic and income segregation can be very clearly defined even in very cosmopolitan cities.

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  • $\begingroup$ "Costs of transportation have become much smaller" - Are you making a comparison with the distant past before cars or trains, or are you referring to some more recent trend? $\endgroup$ – Adam Bailey Nov 16 '16 at 9:56
  • $\begingroup$ Distant past. I'm thinking back when like Pullman trolleys were still a thing. $\endgroup$ – Kitsune Cavalry Nov 16 '16 at 10:26
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In addition to what Jeremy and Kitsune said:

Henry George's Progress and Poverty looked at this problem of poverty amidst plenty more than hundred years ago.

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