I grew up with my sister, grandfather (for 10 years), dog, and two parents in a 960 square foot single-story ranch in a heavily subsidized subdivision (with an armed forces stipend both my grandfather and father qualified for). We did fine. A lot nicer of a result than the trailer home we would've otherwise lived in.
I had friends that lived in small tenements. I had friends that grew up in the projects. 4-5 people, less space. Did fine.
A huge fraction of kids who grow up in the projects do not do fine. If the projects were an automatic sentence of lifetime poverty, we'd do away with them; the fact that some people escape them blurs the issue just enough so that our brain files it away as a grey area. But it's not: the projects are bad.
One good book: _American Project_, by Sudhir Venkatesh.
>A huge fraction of kids who grow up in the projects do not do fine
I don't think anyone would debate this, however, I doubt success was ever really limited by the amount of living space they had growing up. Having lived in the "bad part" of a "rough city", square footage had no bearing on future success.
Square footage may or may not play a part in outcomes, but it's less debatable that "substandard housing" does. It's entirely possible that micro-apartments are a fine addition to the housing market. But that doesn't mean the entire idea of regulating housing is bankrupt.
I had friends that lived in small tenements. I had friends that grew up in the projects. 4-5 people, less space. Did fine.