The Incidence of Housing Voucher Generosity

Robert A. Collinson

New York University

Peter Ganong

Harvard University

May 2015

What is the incidence of housing vouchers? Housing voucher recipients in the US typically pay their landlord a fixed amount based on their income and the government pays the rest of the rent, up to a rent ceiling. We consider a policy that raises the generosity of the rent ceiling everywhere, which is equivalent to an income effect, and a policy which links generosity to local unit quality, which is equivalent to a substitution effect.

Using data on the universe of housing vouchers and quasi-experimental variation from HUD policy changes, we analyze the incidence of these policies. Raising the generosity of the rent ceiling everywhere appears to primarily benefit landlords, who receive higher rents with very little evidence of medium-run quality improvements. Setting ZIP code-level rent ceilings causes rent increases in expensive neighborhoods and decreases in low-cost neighborhoods, with little change in aggregate rents. The ZIP code policy improves neighborhood quality as much as other, far more costly, voucher interventions.

Number of Pages in PDF File: 48

Keywords: Incidence, Vouchers, Housing, Price Discrimination, Search Frictions

JEL Classification: H22, H53, R21, R31

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Date posted: April 24, 2013 ; Last revised: May 3, 2015

Suggested Citation

Collinson, Robert A. and Ganong, Peter, The Incidence of Housing Voucher Generosity (May 2015). Available at SSRN: http://ssrn.com/abstract=2255799 or http://dx.doi.org/10.2139/ssrn.2255799

Contact Information

Robert A. Collinson
New York University ( email )
295 Lafayette Street
New York, NY 10012
United States
Peter Ganong (Contact Author)
Harvard University ( email )
1875 Cambridge Street
Cambridge, MA 02138
United States
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