Targeting In-Kind Transfers through Market Design: A Revealed Preference Analysis of Public Housing Allocation

Abstract

Public housing benefits are rationed through wait lists. Theoretical work on public housing allocation has debated how much choice applicants should have over units, identifying a possible trade-off between efficiency and redistribution. This paper empirically establishes the existence and economic importance of this trade-off using wait list data from Cambridge, Massachusetts. I estimate a model of public housing preferences in a setting where heterogeneous apartments are rationed through waiting time. Eliminating choice would improve targeting but reduce tenant welfare by more than 30 percent. Such a change is only justified on targeting grounds by a strong social preference for redistribution. (JEL D47, H75, I38, R38)

Gains from Reassignment: Evidence from a Two-Sided Teacher Market

“…Their counterfactuals focus on the extensive margin, i.e., how to use higher pay to attract better teachers to the industry, while our paper studies the reassignment of existing teachers within a school district. 4 Lastly, this paper contributes to the growing literature on the revealed preference analysis from centralized markets (Abdulkadiroglu et al, 2017;Waldinger, 2021;Agarwal et al, 2021).…”

Housing Search Frictions: Evidence from Detailed Search Data and a Field Experiment

“…Galiani et al (2015) use the Moving to Opportunity experiment to estimate a model of neighborhood choice. Waldinger (2018) and van Dijk (2019) use observational data from centralized assignment mechanisms to estimate the demand for housing characteristics in low-income populations. Bayer et al (2016) estimate a dynamic model of demand for housing.…”

“…Waldinger (2018) and van Dijk (2019) observe strategies-rank-order lists and lottery participation decisions-together with outcomes in centralized processes. Other studies of decentralized housing markets, in contrast, typically make use of data on location choices only.…”

Waiting for affordable housing in New York City

“…Halket and Nesheim (2017) also consider the problem of optimal allocation of public housing. Waldinger (2019) studies the efficiency of different assignment mechanism using data from Cambridge, Massachusetts.…”