b psycho at Psychopolitik has an interesting post on the failure of programs to disperse the denizens of ghettos: http://www.psychopolitik.com/2008/06/the-tragedy-of-government-cheese/
These programs were predicated on the existence of the so-called "ghetto effect". The idea was that something about the ghetto itself produced a range of "social problems" that poor people who lived outside of areas of concentrated poverty did not experience as much. Since the poor who lived among the non poor had fewer of these problems, it was concluded that living among other poor folks caused the problems. This has spuriousness written all over it, but it was a sexy idea for a while. Now there have been social experiments in the form of government policies that have not borne out the existence of the "ghetto effect".
The mechanism for the ghetto effect was never specified. Perhaps ghettos are cursed and full of bad magic. I suspected that the ghetto effect was a recycling of the old "culture of poverty" idea that was sexy in the 60s and early 70s. At Columbia, I submitted a paper in a class that was a research design to look for mechanisms. This was done tongue in cheek and as a demonstration of just how difficult it would be to pin down such mechanisms for diverse effects that were so clearly overdetermined. The tenured mossback did not get the joke.
Frankly, sociology has not advanced much, if at all, since Weber and Durkheim.
Let's take a brief look at one of the "problems" that the ghetto effect was supposed to produce: bastardy. Whether or not she lives in an area of concentrated poverty, a woman may find it desirable to reproduce. Moreover, her circumstances may be such that she is not particularly marriageable or where marriage would confer few, if any, benefits. It would be perfectly rational in her situation for her to have children out of wedlock, and this would be the case wherever she lived. If she lived in the suburbs, she would have a lot fewer non-traffic contacts with her neighbors and they would have little influence on her decisions. Her suburbanite neighbors are unlikely to turn her from rationality to irrationality. Mothers of bastards do not generally view their children as "social problems" to be eliminated.
Let's look at another "problem": teenage pregnancy and motherhood. If a young woman has no basis for believeing that she will gain by deferring childbearing, then it would be irrational for her to do so if she wants children. Many poor women are compeletely correct in their assessment of their prospects, and early childbearing does not produce significant opportunity costs for them. These facts obtain whether or not they live in a ghetto. Perhaps, it is hoped that living outside the ghetto will allow such women to delude themselves about their range of life choices and to defer childbearing for no good reason other than that their reproduction is offensive to a class of officious busybodies.
The ghetto is not a cause of problems associated with poverty; it is itself an effect.