Housing Subsidies and Work Incentives in Great Britain

Paul Bingley and Ian Walker ()

Economic Journal, 2001, vol. 111, issue 471, C86-103

Abstract: The relationship between housing costs, wages and transfer programmes is complex yet helps determine the incentive to work for individuals in low income or high housing cost households. We estimate a static discrete choice labour supply model that allows for housing benefit programme participation, using samples of married women and unmarried women drawn from Great Britain Family Resources Surveys 1994/5-97/8. We find women are quite responsive to labour supply incentives and that housing benefit income has similar incentive effects to earned income which suggests any "stigma" is small. Our analysis is complemented by simulating housing benefit and direct rent subsidy reforms.

Date: 2001
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