HOUSING AFFORDABILITY AS A STRUCTURAL CONSTRAINT ON SMART ECONOMIC GROWTH: EVIDENCE FROM NEW YORK CITY

Abstract

Smart economic growth emphasizes development that simultaneously promotes productivity, social inclusion, and long-term sustainability. Urban housing systems play a critical role in this process because access to affordable housing determines labor mobility, human capital formation, and spatial economic balance. This study examines housing affordability as a structural constraint on smart economic growth using evidence from New York City. Combining a housing cost burden model, hedonic pricing framework, and neighborhood affordability index, the analysis evaluates how income–rent mismatch, educational accessibility, demographic composition, and density pressures interact to shape urban economic outcomes. The results indicate that rising rents relative to stagnant incomes significantly increase housing cost burdens and restrict residential mobility, thereby weakening labor market efficiency and reinforcing spatial inequality. The findings further show that school quality capitalization and housing scarcity create localized productivity barriers, limiting inclusive participation in high-opportunity areas. Overcrowding and demographic concentration intensify these effects by amplifying economic vulnerability in dense urban neighborhoods. The study demonstrates that housing affordability operates not merely as a social welfare concern but also as a measurable growth determinant that affects economic resilience and long-run development. Policy implications suggest that aligning wage growth, expanding affordable housing supply, and improving access to education constitute complementary mechanisms for achieving smart economic growth. The paper contributes to interdisciplinary growth literature by integrating housing market dynamics into the broader framework of sustainable and inclusive economic development.