Abstract
Like many other Western European governments, the Swedish government has launched an area‐based urban policy in order to solve the problems of the distressed neighbourhoods in the largest cities. However, in the current policy it is not clear whether the primary aim is to address the problems of individuals, or if the aim is to change the market position of the distressed areas. The intervention might be successful in terms of assisting residents in finding jobs and better education, but that might not improve the general position of the areas targeted, since people who make a socio‐economic career very often move out of the areas, to be replaced by poorer and less well‐established residents. By drawing upon a comprehensive and unique set of data the paper analyses the issues of residential mobility and selective migration, with special focus on distressed neighbourhoods in the Stockholm region. The results clearly indicate that the migration flows of these neighbourhoods are indeed selective. The people who move in are more likely to be unemployed and dependent on social benefits and have on average lower incomes than those who move out and those who remain in the neighbourhoods. This simultaneous outflow of relatively well‐off residents and inflow of weaker and more marginalised groups has the effect of reproducing the distressed character of the neighbourhoods.