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Measuring Housing Subsidies: Distortionary and Distributional Effects in the Netherlands

Author

Listed:
  • Harry ter Rele
  • Guido van Steen

Abstract

This paper measures the distortionary and distributional effects of housing subsidies in the Netherlands. Its broad scope allows us to discuss the results in the light of the main justifications for subsidising housing, i.e. the merit-good argument, external effects and the distribution motive. Our measurements reveal some patterns of subsidisation that seem difficult to justify on these grounds. This applies especially to the differences between subsidisation of rental and owneroccupied housing and between mortgage- and equity-financed ownership. Moreover, the inelastic supply of housing in the Netherlands entails that subsidisation has only a limited effect on promoting housing quality.

Suggested Citation

  • Harry ter Rele & Guido van Steen, 2003. "Measuring Housing Subsidies: Distortionary and Distributional Effects in the Netherlands," Fiscal Studies, Institute for Fiscal Studies, vol. 24(3), pages 317-339, September.
    • Handle: RePEc:ifs:fistud:v:24:y:2003:i:3:p:317-339
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    Citations

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    Cited by:

    1. Diego Salzman, 2013. "Behavioural Real Estate," ERES eres2013_334, European Real Estate Society (ERES).
    2. Hoberg, Nikolai & Strunz, Sebastian, 2018. "When Individual Preferences Defy Sustainability — Can Merit Good Arguments Close the Gap?," Ecological Economics, Elsevier, vol. 143(C), pages 286-293.
    3. Diego A. Salzman & Remco C.J. Zwinkels, 2013. "Behavioural Real Estate," Tinbergen Institute Discussion Papers 13-088/IV/DSF58, Tinbergen Institute.

    More about this item

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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