Targeting In-Kind Transfers through Market Design: A Revealed Preference Analysis of Public Housing Allocation

Daniel Waldinger

American Economic Review, 2021, vol. 111, issue 8, 2660-96

Abstract: Public housing benefits are rationed through wait lists. Theoretical work on public housing allocation has debated how much choice applicants should have over units, identifying a possible trade-off between efficiency and redistribution. This paper empirically establishes the existence and economic importance of this trade-off using wait list data from Cambridge, Massachusetts. I estimate a model of public housing preferences in a setting where heterogeneous apartments are rationed through waiting time. Eliminating choice would improve targeting but reduce tenant welfare by more than 30 percent. Such a change is only justified on targeting grounds by a strong social preference for redistribution.

JEL-codes: D47 H75 I38 R38 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (9)

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DOI: 10.1257/aer.20190516

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