For politicians, promoting gentrification was a way to draw investment, tax dollars, and upwardly mobile residents back into the city. The restructuring of the American economy after World War II is important to consider because it in part helped to create the conditions that made inner-city neighborhoods disintegrate. The city thus loses the centralized places of employment that have long supplied inner-city, poor residents with jobs. Furthermore, the globalization of the economy has allowed for large scale production facilities to leave the country altogether. Residents of the ghetto oftentimes do not have the money, resources, or education to find a new well-paying job or to relocate along with the factory.
Capital is indeed much more mobile than labor.
Disinvestment by corporations and government, welfare policies that do not help residents find jobs and fend for themselves, and declining school systems simply perpetuate and deepen the conditions of poverty that take hold in the ghetto. Thus, institutional policies and laws are crucial for the decline of the ghetto. Places or neighborhoods, understood as social entities are produced institutionally, within ecological and technical constraints, by social and political struggles over competing uses of space, resources, and people. And no contemporary urban form demonstrates this more incontrovertibly than the black ghettos of America. Todays inner city is in good part the accumulated and contradictory product of the effects, intended and unintended, of the urban, educational, and social policies followed by federal, state, and local governments in the postwar era.