Abstract: This paper reviews US-European scholars’ summaries of the functional mechanisms of neighborhood effects and the research methods, challenges to the methods of studying neighborhood effects, and the specific empirical studies and practices. The paper contends that neighborhood effects help reduce social differences and promote social equality, which can be explained by both theory and practice. If the government is to adopt some kind of mixed-residence policy to help those in the lower social strata and alleviate the inequality in housing conditions and the overall social inequality as well, the present housing policy has to be improved. More specifically, a progressive reform should be considered: In line with the household registration reform, some of the peasant workers living in cities with a record of good work performance appraisals could be granted eligibility for “economic welfare housing” or “cheap leaser housing.” This paper also attempts to appeal to sociological scholars or even the entire social sciences circle for their attention to the research on neighborhood effects and social inequality.

Key words: neighborhood effect, gautreaux program, 　social equality, housing policy