Housing insecurity, homelessness and populism: Evidence from the UK

Thiemo Fetzer, Srinjoy Sen and Pedro CL Souza

No 14184, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Homelessness and precarious living conditions are on the rise across much of the Western world. This paper exploits quasi-exogenous variation in the affordability of rents due to a cut to rent subsidies for low income benefit in the United Kingdom in April 2011. Using individual-level panel data as motivating evidence, we document that individuals exposed to the cut were significantly more likely to build up rent arrears and face evictions; further, they were more likely to endogenously attrit from the panel. Using comprehensive district-level administrative data, we show that the affordability shock caused a significant increase in: evictions; individual bankruptcies; property crimes; insecure temporary housing arrangements; statutory homelessness and actual rough sleeping with most notable rise in statutory homelessness among families with children. We also note political effects: the cut reduces electoral registration rates, and is associated with lower turnout and higher support for Leave in the 2016 EU referendum, likely capturing a change in composition of those that engage with democratic processes. Lastly, we estimate that the fiscal savings were much lower than anticipated: for every pound saved by the central government, council spending to meet statutory obligations for homelessness prevention increased by 53 pence, rendering the cost savings much smaller than expected

Keywords: Housing insecurity; Homelessness and populism: evidence from the uk (search for similar items in EconPapers)
JEL-codes: D72 H2 H3 H5 P16 (search for similar items in EconPapers)
Date: 2019-12
New Economics Papers: this item is included in nep-cdm, nep-eur, nep-pol and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Housing insecurity, homelessness and populism: Evidence from the UK (2019)
Working Paper: Housing insecurity, homelessness and populism: Evidence from the UK (2019)
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