Incidence and Price Discrimination: Evidence from Housing Vouchers
Robert A. Collinson
New York University
June 9, 2013
What is the incidence of housing vouchers? In a frictionless, price-taking equilibrium, increased generosity of a narrowly-targeted subsidy causes increases in unit quality. However, search frictions may limit quality improve- ments and subsidies may accrue to landlords through price discrimination.
Analyzing a 2005 formula change for Housing Choice Vouchers, we estimate that a $1 increase in the county-wide price ceiling raised same-address voucher rents by 13-20 cents. For tenants who moved, quality improvements were minimal. Second, we find that a Dallas pilot which replaced a metro-wide price ceiling with ZIP-code-specific ceilings improved tenants’ chosen neighborhood quality by 0.2 standard deviations.
Number of Pages in PDF File: 62
Keywords: Incidence, Vouchers, Housing, Price Discrimination, Search Frictions
JEL Classification: H22, H53, R21, R31working papers series
Date posted: April 24, 2013 ; Last revised: June 10, 2013
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