Prof. Cowen - your Marginal Revolution blog earlier today was brought to my attention…A quick note on your selection/transparency comment, which I found of interest. One of the ways that traditionally conceived “selection”/individual effects are neighborhood effects is when the former are an outcome of the latter. It is common in the literature in sociology or psychology at least to see controls for the mediating pathways through which neighborhoods (or really, any context) might plausibly work. For example, we typically see controls for all kinds of family and individual characteristics (including learning), almost all of which are at least potentially influenced by context. Controlling them can thus have the result of eliminating the neighborhood coefficient, which is usually interpreted as evidence for selection as the governing process. But in this example selection factors are themselves neighborhood effects, the basis in part for my reversing a common claim. A number of recent papers independent of my own work have shown a variant of this process (e.g, http://www.ssc.wisc.edu/soc/faculty/pages/docs/elwert/Wodtke%20Harding%20Elwert%202011.pdf). Although often technical, behind the development of these models is an important substantive point I think. Part V of the book also delves into residential migration flows and higher-order structures as another kind of mechanism, including how changing characteristics of neighborhoods influence residential selection.
More generally, I do not view choice/selection and context as an either/or proposition, and as an economist I am guessing you might agree. (Sociologists are typically structural determinists, but that is another story). At Chicago I was influenced by Heckman and his arguments on modeling selection and the often misleading faith put on experiments as revealing causality). Although I tried to examine neighborhood selection seriously, the main motivation of the book was to build up the social science of measuring and conceptualizing the neighborhood and spatial dimensions of social life. Massey’s recent review of my book I think captures the essence of what I was trying to accomplish in terms of contextualizing human behavior and choice/selection — http://www.sciencemag.org/content/336/6077/35.summary.