An earlier post described how some residents of inner-city Baltimore in the 1960s were excluded from the benefits of certain programs because they lived outside the areas in which these programs were targeted. The programs had identified areas with the highest proportions of those in need and limited their services to those areas and their residents. Such spatial targeting has both benefits and costs, which I will consider here.
First, a definition: By spatial targeting, I mean a program for the delivery of services to some group of people, typically disadvantaged, that begins by identifying an area having the highest concentration of those people in need. The services of the program are then provided by facilities that are located in the target area. The targeting of those services can be more or less exclusive. More restrictive targeting limits eligibility for the service to those residing within the target area. Less restrictive policies make the service available to all who would otherwise be eligible, though obviously obtaining the service will be less convenient for those living farther from the target area.
Targeting has advantages. It is efficient in the sense of placing the service locations closest to the greatest numbers of intended beneficiaries. The more restrictive form of targeting can eliminate the need for what might be considered to be obtrusive means tests by restricting eligibility to the residents of the target area. (This is essentially equating “need” with target-area residence.)
A more subtle potential benefit of spatial targeting could come from the effect of the service in improving the overall levels of well-being within the area. The concentration of disadvantge in an area can have negative effects for all area residents (what economists would call a negative externality). By improving conditions for some residents of the area, these adverse neighborhood effects may be reduced, yielding further benefits that accrue to all residents.
Of course these benefits do not come without costs. A targeted program effectively discriminates against those living outside the target area. Those with equal need not living in the area may not be able to receive the services, either because of a policy restricting benefits to target-area residents or because distance to the target area makes the services inaccessible, even without a residence requirement.
With strict targeting substituting a residence requirement for a means test, some service can be provided to those with lesser need. Arguably this could be seen as being less efficient in that not as much service is being provided to those with the greatest need.
Finally, spatial targeting can limit political support for the provision of the service. To be sure, if the service is aimed at the disadvantaged, they will not constitute a majority of the electorate in any event. But by restricting the service to a limited areas, those in areas outside, both disadvantaged and not, may be less inclined to support an activity that does not assist those in need outside the target area. And spatial targeting by its very nature emphasizes the fact that the service is being provided for a relatively small segment of the population.