Divergence in alternative Hicksian welfare measures: the case of revealed preference for public amenities

This paper investigates the divergence between the two Hicksian welfare measures of non‐traded amenity improvement associated with housing. First, the Hicksian surplus measures for amenity changes are analytically developed based on explicit specification of utility structures. A hedonic two‐stage approach is then applied to empirically show that, for quantity changes, in contrast to hypothetical markets, divergence in real market is small. The paper also analytically develops expressions for the income and substitution effects and empirically shows that for a given income effect, the greater the substitution effect the smaller the divergence between the two measures. Copyright © 2002 John Wiley & Sons, Ltd.     

Nonlinear budget constraints and consumer demand: An application to public programs for residential housing

This study presents a methodology for exploiting the nonlinear hedonic nature of housing prices to estimate the compensated demands of households for particular housing attributes. The methodology is employed to provide Hicksian benefit measures of a particular housing subsidy program typical of those undertaken recently in developing countries.     

Participation behavior and distributional consequences under a multiple constrained housing program

A distinguishing feature of supply-side housing subsidy programs is that potential participants must jointly accept the multiple constraints imposed by the programs in order to get the subsidy. This paper investigates how information about this feature and the characteristics of the participants can be used to model the conditional probability of participation and to determine the sources of equity/inequity in the distribution of benefit from such programs. The benefit is explicitly estimated in terms of the Hicksian consumer surplus measure using data from the Section 8 New Construction program. Among other findings, it is shown that the probability of participation is a positive function of the perceived benefit but a negative function of the participants' income.     

Implications of alternate policies on welfare of slum dwellers: Evidence from Pune,India

In this paper we examine how slum dwellers value location-based amenities. In most developing country cities, residents living in slums have poor-quality dwellings and limited access to basic public services and amenities. Using data from Pune, India, we estimate the residential location choices of slum dwellers, which are conditional on housing quality, neighborhood amenities, and community structure. We use these estimates to simulate the impact of alternate interventions on household welfare. We find that households derive benefits from housing quality and neighborhood amenities. While relocating households to the periphery has adverse consequences for household welfare, we show that households could be adequately compensated out of the increased tax revenue accruing from alternative uses of the vacated central land.     

THE THEORY AND ESTIMATION OF INDIVIDUAL AND SOCIAL WELFARE MEASURES

Abstract. The most widespread measure of individual welfare is consumer surplus ( cs ). If consumer surplus is to represent underlying preferences, very restrictive assumptions must be imposed and, worse, the resulting measures completely ignore distributional issues. Applied economists often argue that consumer surplus is a good approximation to the theoretically correct measures and the only feasible choice in practice. This is no longer true; recent advances in estimation techniques have made it possible to determine the approximate values of the correct measures quite satisfactorily. The theory and estimation of social welfare measures automatically involves ethical and distributional judgements. Often, these are difficult to incorporate in intuitive summary indicators that are easy to estimate. A range of money metric measures is presented that provide a more desirable, albeit still problematic alternative. Subject to severe data limitations, the theoretically correct welfare measures can be estimated for a wide range of modelling situations using parametric and nonparametric techniques.     

Growth and Distributional Impacts of Urban Housing Supply: An Application of Urban Land Use and a CGE Model For Seoul

This paper assesses economic effects of housing supplies on the urban growth and income distribution of Seoul, using an urban land use and Computable General Equilibrium model of Seoul economy. The simulation shows that the housing development with the conversion of the green or the industrial land uses into the residential land use leads to an increase of the Gross Regional Product by approximately 1% at the worse income inequality. The aggregate welfare effects in terms of Hicksian Compensating Variation range from 1.746 trillion Korean Won to 1.768 trillion Korean Won on a ten-period average, depending on the type of the land conversion.     

Workfare,welfare, agency,and well-being

Workfare programs are state-instituted programs that require able-bodied persons with children of school age who wish to claim welfare payments to participate in job training programs, and, eventually, to enter the work force. The philosophy of workfare is based on the value of work and the goal of self-determination. However, as a mandatory program for welfare recipients, workfare requires of those recipients certain duties which, according to those who challenge workfare, interfere with the freedom to choose what one will do with one's life. Whether some form of workfare will be adopted as part of our national welfare system remains to be seen. What the debate about such a program suggests is that welfare, in itself, by ignoring the necessity of security and education for full human agency, neither satisfies basic needs nor prepares its recipients for any life other than that of dependency. With all its difficulties workfare nevertheless presents an alternative to welfare that, at least in theory, more closely identifies its purpose with the values of our society.     

Are housing benefit an effective way to redistribute income? Evidence from a natural experiment in France

In this paper, I show that in-kind benefit such as a housing benefit program may have a significant impact on the price of the subsidized good. I use a French housing benefit reform to evaluate the impact of the subsidy on the level of rents. The results indicate that one additional euro of housing benefit leads to an increase of 78 cents in the rent paid by new benefit claimants, leaving only 22 cents available to reduce their net rent and increase their consumption. This large impact of housing benefit on rents appears to be the result of a very low housing supply elasticity. I show that the housing benefit reform induced additional demand, not only from low income households but also from students who used the benefit to become independent. Unfortunately, this increase in demand was unmatched by increasing housing supply in the short and middle term. The only possible effect of the reform is a small increase in housing quality. These results raise questions about the use of such in-kind transfers when the supply of the subsidized good is almost inelastic. It is therefore very important to estimate the incidence of the subsidy when assessing the efficiency of such welfare programs.     

Do inter-city differences in intra-city wage differentials have any interesting implications?

Recent research has related characteristics of cities to differences in the distribution of wages across workers with different skill levels. We demonstrate that these differences in wage differentials arise naturally as a compensating variation in Rosen’s theoretical model of inter-city wages. For example, if the income elasticity of demand for housing services is less than unity, cities with higher house prices will have smaller money wage differentials between low and high skill workers. This result has no implications for differences in either absolute or relative real productivity or welfare of unskilled workers. Similarly, changes in the amenity of an urban area may result in changes in relative wages of skilled and unskilled workers with no implications for real productivity or welfare differentials.Empirical tests in which housing cost differentials are added as a determinant of inter-city differences in an intra-urban wage differential model provide empirical confirmation of the theoretical expectations. It appears that intra-urban money wage differentials, differences in the quality of life, and variation in the cost of living in each city are jointly determined variables just as Rosen’s model of inter-city wage differentials predicts.     

Do inter-city differences in intra-city wage differentials have any interesting implications?

Recent research has related characteristics of cities to differences in the distribution of wages across workers with different skill levels. We demonstrate that these differences in wage differentials arise naturally as a compensating variation in Rosen’s theoretical model of inter-city wages. For example, if the income elasticity of demand for housing services is less than unity, cities with higher house prices will have smaller money wage differentials between low and high skill workers. This result has no implications for differences in either absolute or relative real productivity or welfare of unskilled workers. Similarly, changes in the amenity of an urban area may result in changes in relative wages of skilled and unskilled workers with no implications for real productivity or welfare differentials.Empirical tests in which housing cost differentials are added as a determinant of inter-city differences in an intra-urban wage differential model provide empirical confirmation of the theoretical expectations. It appears that intra-urban money wage differentials, differences in the quality of life, and variation in the cost of living in each city are jointly determined variables just as Rosen’s model of inter-city wage differentials predicts.     

美国不同时期的住房补贴政策:实施效果的评价及启发

本文研究了美国住房政策70年的演变历程,着重分析了公共住房计划、购房补贴计划(235条款)、租房补贴计划(236条款)以及第8条款中的住房津贴计划、代金券计划等重要的住房补贴计划,对这些补贴计划的实施效果进行了评价,为我国研究住房政策提供有价值的参考.     

Assisted Housing and the Educational Attainment of Children

This paper examines the long-term effects of assisted housing on the educational attainment of children. It is based on unique data, the Panel Study of Income Dynamics (PSID)-Assisted Housing Database, in which we have matched addresses of all PSID sample members to addresses of federal and state assisted housing. Using a two-stage instrumental variable approach, the inferior educational outcomes of children who live in public housing disappear when measured characteristics are taken into account, while unmeasured characteristics have insignificant effects. We also find neither positive nor negative effects of privately owned assisted housing. These findings are similar to those on the effects of other social welfare programs.     

What Makes a Good Mediator? Insights from a Mediation Training Program Participant

Mediation is a popular form of alternative dispute resolution for settling conflicts occurring in employment settings. Such workplace conflicts handled by mediation, for example, include discrimination, wrongful termination, as well as various labor-management issues. Defined as a structured process where a neutral third party assists the two conflicting parties in arriving at a voluntary resolution, individuals have undergone mediation training in order to become mediators. While research exists on how mediation-training programs should be structured, the purpose of this research is to determine the key attributes required to develop good mediators and whether such characteristics can be acquired through mediation-training program participation. Utilizing an autoethnographic methodology as a mediation training program participant, it was discovered that effective mediators demonstrate strong communication skills, flexibility, neutrality, composure and ethicality during the mediation process which can be attained through participation in mediation-training programs.     

A dynamic almost ideal demand system incorporating consumer expectations

In this paper a theoretical framework is presented for the analysis of the effects of psychological, perceptual or expectational factors on household expenditure within a complete demand system. The model was estimated using the Consumer Sentiment Index, which represents an index of consumer perceptions of economic conditions. Evidence was found for significant expectational effects on five of nine expenditure categories—food at home, alcohol, housing, durables and other services. The direct expectation effects were found to be small in size. The results demonstrate the model's potential usefulness as a framework for modelling consumer behavioral responses to expectations and for evaluating the welfare implications of policy-induced changes in expectations.     

The Effect of Public Social Housing on Households' Consumption in France

The French public social housing sector offers rents which are more than 60% below market levels. The “loss” of the public sector landlords, estimated from the rent they could get for their apartments at market prices, amounts to 37 billion Francs per year for the 3 million public social apartments in France. This allows the social sector tenants to consume 10% more housing services and 11% more of other goods. The corresponding surplus gain is around 34 billion Francs. The surplus loss for the collectivity due to these transfers is thus 3 billion Francs, 8% of the transferred sums. As compared to personal housing subsidies, which represent half this amount for the same tenants, the surplus gains are much less concentrated on the poorest part of the population.     

When Does a Firm Support Substitute Open Source Programming?

Software firms are observed to support programmers' communities, which develop rival open source programs. A firm selling a copyright program has an incentive to support substitute copyleft programming when support creates compatibility between the programs and programs exhibit network effects. Costly compatibility benefits the firm as its consumers gain access to the community's services but may also hurt the firm because it cannot profit from the valuation difference between incompatible networks. The incentive arises under a weak network effect even when the consumers' benefit is small. Standardization and enlarging the open source programmers' community do not always increase welfare.     

INNOVATION IN A REGULATED SERVICE: The case of English housing associations

This article explores the previously unexamined relationship between innovation and regulation in public service organizations. Innovation and regulation are conceptualized as different types of change - innovation is discontinuous change and regulation change to modify the behaviour of regulatees in relation to standards. Evidence is presented from a highly regulated public services sector - English housing associations, which are regulated by the Housing Corporation. In order to explain the behaviour of the case study housing associations and the regulator to innovation a two-stage innovation classification technique is developed and tested. Stage one draws upon social policy typologies, and stage two on attributes shown to influence innovation in other research. Housing associations' innovations are presented, categorized and classified. The findings indicate that innovation occurs at the borders of regulatory jurisdiction and that it is the tensions over these boundaries that are key drivers of innovation.     

Estimation and policy implications of rental housing demand

The demand for rental housing using the Annual Housing Survey SMSA sample for 1977 is estimated. The principal determinants of rental housing demand, namely housing price and permanent/transitory income, are computed through spatially varying hedonic price techniques and instrumental variables methods (relating to human and nonhuman capital), respectively. Based on the demand estimation results, impacts of hypothetical cash and rent subsidy programs are analyzed in terms of “housing” and “welfare” effects. It is found that a rent subsidy achieves considerably larger effects than does a cash subsidy.     

The economics of urban yard space: An “implicit-market” model for housing attributes

A theoretical housing model is developed embodying the approach of the recent hedonic price literature. Instead of focusing on a scalar “housing service” consumption measure, the model portrays housing as a commodity with two attributes: floor space and yard space. Developers react to a consumer bid-rent function, which relates dwelling rent to floor space, yard space, and location, in choosing the profit-maximizing characteristics of their housing complexes. The spatial behavior of the developer's choice variables is investigated (an interesting question is whether yards are larger farther from the urban center), and a comparative static analysis of the housing market equilibrium is presented.     

Negotiating the Politics of Exclusion: Georges Candilis,Housing and the Kuwaiti Welfare State

In the early stages of welfare planning, the Kuwaiti state restricted equal access to its housing programs in neighborhoods outside the city. The subsequent demographic shift, caused by a Kuwaiti exodus to the ‘suburbs' and non‐Kuwaiti urban labor migration, prompted calls for housing schemes to encourage city living for citizens. Georges Candilis's proposal for a residential neighborhood in Kuwait City emerged from this context. This article examining Candilis's unrealized project also offers a critical perspective on Kuwait's unbalanced housing policies. From this analysis, it draws observations on the role of architects and their limited impact on policies established by decision‐making networks within the welfare state. Seen from this perspective, the Candilis project bears witness to broader socio‐economic agendas that privileged some groups while marginalizing or excluding others.