Implicit Rents from Own-Housing and Income Distribution: Econometric Estimates for Greater Buenos Aires
Leonardo Gasparini and
Walter Sosa Escudero ()
CEDLAS, Working Papers from CEDLAS, Universidad Nacional de La Plata
Most income studies do not take into account the implicit rent obtained by households who inhabit their own dwellings, a fact that introduces a potentially relevant bias in inequality, poverty, and welfare measures. In this paper we estimate these implicit rents for the Greater Buenos Aires area from information of Argentina’s National Household Expenditures Survey (ENGH) of 1996/7. Based on a sample of households that rent their dwellings, quantile regressions are used to estimate observed rents from a hedonic model. Estimated coefficients are applied to households that do not rent their houses or apartments in order to predict the implicit rent derived from living in an owned house. Estimated implicit rents are added to the standard notion of household income and various inequality measures are reestimated. We find that the consideration of these implicit rents reduces inequality due to an income elasticity of spending in housing less than one, and to the relatively large proportion of house owners in the lower strata of the income distribution.
Keywords: implicit rent; hedonic prices; quantile regression; housing; income distribution. (search for similar items in EconPapers)
JEL-codes: D31 R21 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-geo, nep-lam, nep-ltv and nep-ure
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Published in Journal of Income Distribution 12 (1-2): 32-55.
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Working Paper: Implicit Rents from Own-Housing and Income Distribution. Econometric Estimates for Greater Buenos Aires (2004)
Journal Article: Implicit Rents from Own-housing and Income Distribution: Econometric Estimates for Greater Buenos Aires (2003)
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Persistent link: https://EconPapers.repec.org/RePEc:dls:wpaper:0014
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