Abstract
The role of neighborhoods in shaping child and adolescent development is well-documented in empirical research. However, the extent to which neighborhood conditions differentially affect individuals based on their background and individual characteristics remains less explored. This paper investigates the heterogeneous effects of neighborhood socioeconomic composition by combining Norwegian administrative data with genetic data from the Norwegian Mother, Father, and Child Cohort Study (MoBa). Employing the Neighborhood Choice Model to address selection bias, we find that exposure to neighborhood disadvantage during a child's first ten years impacts 5th-grade standardized test scores. Furthermore, we find that the effects of neighborhoods vary considerably by socioeconomic background, gender, and children’s load for genetic variants correlated with educational attainment. Notably, boys, children with a lower polygenic index for educational attainment, and those from families with lower incomes and parental education levels face the strongest neighborhood effects. Conversely, children with a higher polygenic index for education are unaffected by neighborhood disadvantage, as are children with affluent parents. These findings highlight the importance of studying heterogeneous neighborhood effects.