- Where we are born plays a big role in determining our economic prospects.
- A new model uses data insights to help low-income areas attract investment.
- This approach could make significant social impact in cities around the world.
Over the past three decades it has become increasingly clear that neighbourhoods play a key role in shaping economic prospects. A long body of research shows that where we live determines many of our life opportunities—from access to good schools to decent jobs and the transportation that connects us to those jobs.
Take the historic neighborhoods along New Orleans’ Claiborne Avenue. In its heyday, Claiborne Corridor was a cradle of jazz and the heart of a thriving black business district. Then came the construction of the Interstate. Erected in the 1960s, Interstate 10 devastated the area, ushering in a long period of isolation and decline.
Today, Claiborne Avenue touches some of the most vulnerable parts of the city. Life expectancy is 10-20 years shorter than in communities just a few miles away. In Tremé, a historic neighborhood along the avenue, nearly four in 10 people live in poverty.
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Two years ago, Michelle Thompson - a professor of planning and urban studies at the University of New Orleans - came to Mastercard with a big idea about how we could help support these neighbourhoods. She wasn’t looking for a cheque; she was looking for data insights.
By combining on-the-ground information from open-source data and insights from Mastercard’s anonymized and aggregated transaction data, we were able to help her build a new model to help low-income areas attract much-needed investment.
Our partnership with Dr. Thompson and the community in New Orleans offers several lessons for other purpose-driven companies committed to doing well by doing good. We’ve found it takes a combination of the right insights, people and partnerships to power change from the ground up.
What's the World Economic Forum doing about the future of cities?
Cities represent humanity's greatest achievements - and greatest challenges. From inequality to air pollution, poorly designed cities are feeling the strain as 68% of humanity is predicted to live in urban areas by 2050.
The World Economic Forum supports a number of projects designed to make cities cleaner, greener and more inclusive.
These include hosting the Global Future Council on Cities and Urbanization, which gathers bright ideas from around the world to inspire city leaders, and running the Future of Urban Development and Services initiative. The latter focuses on how themes such as the circular economy and the Fourth Industrial Revolution can be harnessed to create better cities. To shed light on the housing crisis, the Forum has produced the report Making Affordable Housing a Reality in Cities.
Advancing actionable insights
Analytics are a valuable commodity in the digital age. Companies have invested heavily in the latest insights and tools to help their businesses grow. The public and nonprofit sectors should be able to share in these advantages, but they too often lack the resources to harness data and information. At the Mastercard Center for Inclusive Growth, we recognize that we cannot progress by looking at economic inequality in isolation; we must also address the growing challenge around information inequality.
Data insights can help cities build new models to help low-income areas attract much-needed investment. That’s why we’re working to connect those on the front lines of inclusive growth with the tools they need to leverage the power of data and information for social impact. When leaders have better metrics and tools to hear from citizens and to track trends in neighbourhoods, they can ensure investments are solving the needs that matter most to residents. Network analytics can also help cities anticipate which industries will help them accelerate growth and create quality jobs so they can be proactive, not reactive.
Dr. Thompson and our team of data scientists analyzed consumer spending, and found that spending and store openings in the neighbourhood had risen sharply since 2015—a finding that surprised many. Community leaders say the insights are vital to their efforts to attract new investment and ensure development efforts benefit everyone in the neighbourhood.
Data and analytics aren’t enough on their own; it’s important to engage the experts closest to the problem. Community organizers and researchers bring needed context to data analysis—and will ask very different questions of the data than your own employees, clients or customers.
It’s also important for companies to employ a diverse group of people and to tap into their unique expertise. As a former labour organizer and public servant who now leads philanthropy and sustainability at Mastercard, I recognize the value of bringing the right people to the table to get to a win for everyone. As more purpose-driven companies align their business strategies with social impact, we should recruit leaders with grassroots-organizing experience to the private sector. These change-makers can see the potential in harnessing a company’s expertise, technology, data and relationships for social impact. They also have the skills to pull from their diverse experiences, know-how and networks to make a difference at the right time.
The New Orleans project, which involved more than 60 Mastercard data scientists, also spurred the creation of a new internal programme to engage the company’s 600-plus data experts in pro-bono work. Such efforts can offer employees a greater sense of purpose and a stronger connection to the place where they work, which is critical to recruiting and retaining top talent. They also enhance a company’s ability to create impact.
Building partnerships for scale
As the digital age ushers in a ‘new generation of inequalities’ around information, technology and education, the private sector must play a pivotal role in connecting people to the resources and networks they need to get by and get ahead in a changing economy.
To be truly inclusive, all communities and people will need information to make smarter decisions, transact more safely and securely, acquire the tools to better manage their time and money and enjoy lifelong opportunities to learn new skills to remain productive in the workforce.
It will require big solutions - and that takes collaboration. Partnerships like Data Science for Social Impact, which we launched with the Rockefeller Foundation last year, will be critical to empowering nonprofit, civic and government organizations by giving them the tools, expertise and knowledge to solve the world’s most pressing challenges.
Let’s work together to build programmes, platforms and partnerships that harness the innovations that are driving upheaval to make technology work for people, not against them.