Homeownership, community interactions, and segregation

Karla Hoff and Arijit Sen

No 3316, Policy Research Working Paper Series from The World Bank

Abstract: The authors consider a multi-community city where community quality is linked to residents'civic efforts, such as being proactive in preventing crime and ensuring the quality of publicly provided goods. Homeownership increases incentives for such efforts, but credit market imperfections force the poor to rent. Within-community externalities can lead to segregated cities-with the rich living with the rich in healthy homeowner communities, and the poor living with the poor in dysfunctional renter communities. The pattern of tenure segregation across communities in the United States accords well with the study's prediction. The authors analyze alternative tax-subsidy policies to alleviate inefficiencies in the housing market and identify the winners and losers under such policies.

Keywords: Environmental Economics&Policies; Economic Theory&Research; Community Development and Empowerment; Housing&Human Habitats; Education and Society; Housing&Human Habitats; Environmental Economics&Policies; Governance Indicators; Economic Theory&Research; Education and Society (search for similar items in EconPapers)
Date: 2004-05-01
New Economics Papers: this item is included in nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Related works:
Journal Article: Homeownership, Community Interactions, and Segregation (2005)
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