Housing Benefit (HB) in the UK subsidizes the rent of tenants in both the private and publicsectors. Its share in total welfare benefits has risen markedly through time and there iswidespread dissatisfaction with it. But, reform has been very slow. One important issue isthe extent to which the incidence of HB is actually on the tenants. Exploiting two data setsfrom the mid-1990s when the subsidy regime changed for some tenants but not for others,this paper explores the incidence. We find that some of the incidence is on landlords thoughour two data sets differ in the extent to which this is true. We also find evidence in support ofa ¿matching¿ model of the rental market rather tha n a perfectly competitive one.
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Paper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number
dp0597.
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