Public housing units vs. housing vouchers : Accessibility, local public goods, and welfare

Research output: Journal Publications and ReviewsRGC 21 - Publication in refereed journalpeer-review

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Original languageEnglish
Pages (from-to)310-321
Journal / PublicationJournal of Housing Economics
Issue number4
Publication statusPublished - Dec 2012


We develop a general equilibrium model of residential choice and study the effects of two housing aid policies, public housing units and housing vouchers. Land is differentiated by both residential accessibility and local public goods, and the provision levels of local public goods are determined by property tax revenues and neighborhood compositions. Households differ in their incomes and preferences for local public goods. Housing aid policies are financed by general income taxes. We discuss how the location of public housing units is a fundamental policy variable, in addition to the numbers and sizes of units, and argue that vouchers not only cause less distortion for social welfare compared to public housing, but may also improve overall welfare. © 2012 Elsevier Inc.

Research Area(s)

  • Endogenous sorting, Housing policy, Local public goods, Residential location choice, Welfare