Asset Building as a Community Revitalization Strategy

Asset building, an emerging theme in community revitalization, sometimes is defined broadly to include all potential resources in a community - not only financial resources but also the talents and skills of individuals, organizational capacity, political connections, buildings and facilities, and so on (Kretzmann & McKnight, 1993). In this usage, the term "assets" may appear to mean "all good things" and is thus only a vague guide to social work practice. Moreover, from the standpoint of knowledge building, theoretical statements and empirical confirmation are elusive with such a wide-ranging concept. Before Kretzmann and McKnight's (1993) proposal to build assets in community development, Sherraden (1988, 1990, 1991) suggested that households and communities develop not by income alone (the dominant theme of the welfare state), but also by savings and asset building. In this usage, the term "assets" is restricted to the concept of wealth, including both property and financial holdings. Sherraden's work includes propositions about the personal, social, economic, and community effects of asset holding that invite empirical tests. As often happens, community development and policy initiatives based on asset building have advanced before the establishment of a sound knowledge base. Sherraden proposed a system of individual development accounts (IDAs) - matched savings for purposes such as education, home ownership, and small business development. As a result of this proposal, a number of IDA projects have emerged around the country (Edwards, 1997). Oliver and Shapiro (1995) have made a particularly strong case for asset building in revitalization of African American communities. Most states have raised asset limits in welfare reform; 15 states have set up IDAs or some other special savings program for the poor population, and seven states provide a progressive subsidy for these savings (Corporation for Enterprise Development, 1995). IDAs recently were adopted as a national project of AmeriCorps VISTA, in which volunteers will help create IDA programs in community development credit unions. The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (P.L. 104-193) allows states to use welfare block grants to match savings in IDAs and encourages the private sector to match savings as well. All such savings will be disregarded from asset limits in means-tested federal programs. Congressional bills for IDA demonstrations, such as the Assets for Independence Act (U.S. Senate, 1995), cosponsored by Sen. Dan Coats (R-IN) and Sen. Carol Moseley-Braun (D-IL), have bipartisan support. In the private sector, the largest funder of community development initiatives is the Ford Foundation, which has recently reorganized a division called "Asset Building and Community Development." Studies that evaluate the implementation, performance, and effects of IDAs and other asset-based community revitalization initiatives will be critical to assessing the potential of domestic policy built in part on individual savings accounts. For example, the Center for Social Development at Washington University in St. Louis is undertaking a six-year evaluation of a multisite IDA demonstration funded by a consortium of foundations. In planning and implementing such studies, IDA evaluators can be guided in part by previous research on effects of asset holding. The key question is, Does asset holding have positive effects, and if so, for whom and under what circumstances? This article summarizes findings from studies that address effects of asset holding on personal well-being, economic security, civic behavior, women's status, and children's well-being. Effects of Asset Building The studies summarized in this article were chosen in a somewhat arbitrary manner and thus provide only an initial look at the effects of assets. Nonetheless, asset holding appears to have multiple positive effects, particularly for people who are economically vulnerable. …