1  We also drop all census tracts in Tennessee because the data on length of vacancy for that state are not accurate. BIS central bankers’ speeches  9  To create a typology of these high-vacancy tracts, we merge in data on tract characteristics from the 2006–10 American Community Survey and estimate a factor model.
Factor analysis is designed to combine a set of variables in a way that summarizes common elements. The analysis identifies three factors that account for a meaningful fraction of the variance of the characteristics in the model.2 Table 1 reports the census tract characteristics used in the model and weights that each factor places on each characteristic.