Health Implications of Housing Programs: Evidence from a Population-Wide Weatherization Program

34 Pages Posted: 20 Jul 2022 Last revised: 21 Oct 2022

See all articles by Steffen Künn

Steffen Künn

University of Potsdam

Juan Palacios

Massachusetts Institute of Technology (MIT) - Center for Real Estate; IZA Institute of Labor Economics

Date Written: March 25, 2022

Abstract

Can better housing protect us from extreme weather conditions? Although economists and policymakers are certain about the health implications of housing upgrades, empirical evidence is largely missing or based on small-scale experiments in developing countries. This study provides population-representative quasi-experimental estimates based on the renovation program which renovated half of the East German housing portfolio in the aftermath of the German reunification. During the 1990s, the German government devoted significant financial resources to upgrade the insulation and heating systems of over 3.6 million dwellings in East Germany. We link the renovations to individual demand for health care of occupants using the German Socio-Economic household Panel (SOEP), as well as administrative records from the German hospital statistic. Relying on a fixed effect strategy, exploiting the staggered roll-out of the renovation program, our results show that an improvement in housing quality enhances the health of vulnerable age groups. Evidence from hospital records suggests that the reduction in hospitalization is driven by lowering the risk of cardiovascular problems for older individuals (45 years or older), and mainly driven by days with extremely high and low ambient temperatures. Our findings have strong policy implications and can enrich cost-benefit analysis of public investments in weatherization programs.

Keywords: Housing quality, renovation program, health

JEL Classification: H54, I18, R21, R23, R38

Suggested Citation

Künn, Steffen and Palacios, Juan, Health Implications of Housing Programs: Evidence from a Population-Wide Weatherization Program (March 25, 2022). MIT Center for Real Estate Research No. 22/06, Available at SSRN: https://ssrn.com/abstract=4166448 or http://dx.doi.org/10.2139/ssrn.4166448

Steffen Künn (Contact Author)

University of Potsdam ( email )

August-Bebel Strasse 89
Potsdam, 14482
Germany

Juan Palacios

Massachusetts Institute of Technology (MIT) - Center for Real Estate ( email )

United States

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

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