Gentrification in Stockholm: A Study on Determinants of Dynamic Spatial Income Distribution

Abstract: This study employs the framework of the monocentric model of land-use to investigate causal factors of gentrification in Stockholm between 2000 and 2010. To calibrate the model to this previously untested city, we first examine if the model can explain the static income patterns in Stockholm as of year 2000. We find that the income distribution in Stockholm can be explained by the presence of amenities, which attracts high-income households, and by public transit, which attracts low-income households. Based on this, we continue to examine the two major dynamic modifications of the model that can be applied in explaining gentrification. Our key finding is that the degree of gentrification is influenced by neighborhood spillover effects, measured as the distance to the closest high-income neighborhood. This suggests that gentrification moves like ripples on the water, which has implications for future city planning. However, while filtering effects have been emphasized in previous gentrification literature, we find no significant evidence for this in Stockholm. The filtering effects imply that gentrification occurs in deteriorated neighborhoods with high dwelling ages. We suggest that the special features of Stockholm, with a rich amenity center, anchor high-income households to the city center, preventing the filtering process in central areas of the city.