Differentiation under capitalism: Genesis and consequences of the rent gap

Uneven development theory and its corollary (i.e. rent-gap theory) are either excessively general or insufficiently flexible to expound the variations of gentrification with unique historical trajectories. A representative example is education-led gentrification in China. The lacuna restricts the explanatory power of rent-gap theory and justifies the fault line between the rent gap and two important phenomena: the forms of displacement identified by Marcuse and territorial stigmatisation. This paper recasts Neil Smith's insights about uneven development from two perspectives, temporal and social differentiations, and elaborates how the interplay between both differences engenders territorial stigmatisation and displacement. Moreover, as two diametrically opposed phenomena, territorial glorification (e.g. super-gentrification and education-led gentrification) and territorial stigmatisation are simultaneously situated in one framework, which is evaluated in education-led gentrification in Nanjing. Redirecting the empirical research from global cities to less established but more representative urban centres, this research shows the potentially wide applicability of the theoretical framework.

Potential rents vs. potential lives

The seeking of potential rents directs flows of investment into built and natural environments, suffusing volatility into urban and rural landscapes, generating gentrification and other forms of land use change, and displacing lives and livelihoods to make space for ‘improvement’, ‘highest and best use’, ‘revitalization’, or the like. In this paper we argue that potential rents are captured at the cost of potential lives, and that rent gap theory, long central (and limited) to gentrification theory, is more widely applicable to the dynamics of land use change and uneven geographical development in capitalist societies. By reading David Harvey’s analyses of rent and accumulation by dispossession as a sophisticated formulation of rent gap theory, we relate the seeking and capturing of potential rents to the power of landed developer interests and a broadened conceptualization of rentiership. We furthermore relate the seeking of potential rents to an ideology of limitless accumulation, and the striving to rein in potential rents to ideas of degrowth and the need for a culture and a politics of limits. Brief vignettes from the ‘primary sector’ (fisheries in the Baltic Sea, dairy farming in Europe, and small-scale farming in Sweden) suggestively illustrate our central argument that the seeking and capturing of potential rents stand in stark opposition to potentials for wellbeing and flourishing of human and non-human lives. We conclude that constraining potential rents – founded as they are on faith in limitless growth – requires a culture of self-limitation and politically imposed limitations commensurable with post-capitalist societies.

Uneven Neighborhood Recovery: Hurricane Damage and Neighborhood Change in the Houston–Galveston Region since 1970

Despite the growing number of natural disasters around the globe, limited research exists on post–disaster patterns of neighborhood change. In this paper, we test two theories of neighborhood change, the “recovery machine” and “rent gap,” which predict opposing effects for low socioeconomic status (SES) neighborhoods following damage from hurricanes, tropical storms, and other natural hazard events. The recovery machine theory posits that after natural hazard events, local communities experience patterns of recovery based on their pre–disaster SES and access to resources, suggesting that wealthier neighborhoods will recover robustly while lower status neighborhoods languish. In contrast, the rent gap theory suggests that developers will identify a profit opportunity in the depressed values created by damage from natural hazard events, and seek to redevelop low SES areas. We use fixed effects models with census data from 1970 to 2015 to test the impact of damage from natural hazards on neighborhood change. We find substantial recovery and change in low–income neighborhoods, but not in the high–income neighborhoods supporting the rent gap theory. We conclude that natural hazard events resulting in damage produce uneven recovery by socioeconomic status of neighborhoods, potentially leading to displacement of low SES groups.

Rent gap reloaded: Airbnb and the shift from residential to touristic rental housing in the Palma Old Quarter in Mallorca, Spain

In light of the advent of Airbnb, rent gap theory can be helpful for understanding how tourist rentals affect residential rental housing. It is argued that on those properties currently rented to residents, rental payments are not only ‘actual ground rent’, but also ‘potential ground rent’. The shift from a residential to a touristic use of rental housing thereby creates a potential ground rent. Taking as a case study the Palma Old Quarter in Mallorca, Spain, this paper analyses the evolution of the stock, prices, and revenues of residential rentals vis-à-vis tourist rentals and finds that, because it is more profitable to rent to tourists than to residents, the number of houses listed on Airbnb has increased, housing affordability for residents has shrunk, and the threat of displacement has increased.

Jenseits von schwäbischen Spätzlemanufakturen und kiezigen Kneipen – polit-ökonomische Perspektiven auf Gentrifizierung

Within public discourse, many journalists and other opinion makers often blame students, artists and hipsters as driving forces behind the displacement of working class households. Contrary to these popular explanation patterns, the essay argues that gentrification is a class struggle between those at risk of displacement and the agents of capital. To understand this struggle and the deeper causes of gentrification, critical urban studies offer a range of much more conclusive theoretical approaches and concepts – such as the rent gap theory, David Harvey’s urban political economy, and the neoliberalization of housing provision – to explain displacement processes, to reveal the fundamental social power relations, and to suggest strategies for resistance and political alternatives.

Transformation of a City

Gentrification changes the landscape and the cultural makeup of a city by increasing property values and changing consumption patterns. Since the late 1980s, gentrification has challenged the residential and small business community of Harlem, New York. Guided by the rent gap theory and the consumption-side theory, the purpose of this case study was to explore how small business leaders can compete with demographical changes brought by gentrification. A purposive sample of 20 Harlem small business owners operating during the city’s gentrification participated in interviews. Interview interpretations were triangulated with government documents and periodicals to bolster the trustworthiness of the final report. These findings may contribute to positive social change by informing the strategies employed by small business owners who are currently facing gentrification.