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Homelessness

Author

Listed:
  • Ayse Imrohoroglu
  • Kai Zhao

Abstract

We present a dynamic general equilibrium model of homelessness calibrated to the U.S. data and evaluate the effectiveness of several policies in the fight against homelessness. The model is designed to capture the most at-risk groups, producing a diverse homeless population that includes a significant portion experiencing short-term homelessness due to labor market shocks and a smaller portion facing chronic homelessness mostly due to health shocks. Our policy experiments reveal that the existing housing voucher program effectively reduces homelessness especially when the general equilibrium effects are accounted for. We show that increasing the reach of the program for eligible individuals can lead to further declines in the aggregate homeless rate relative to alternative forms of subsidies. However, policies targeted to help decrease homelessness are not as popular as general poverty reduction tools such as cash subsidies, which generate a larger welfare gain in our experiments.

Suggested Citation

  • Ayse Imrohoroglu & Kai Zhao, 2024. "Homelessness," Opportunity and Inclusive Growth Institute Working Papers 103, Federal Reserve Bank of Minneapolis.
    • Handle: RePEc:fip:fedmoi:99008
    DOI: 10.21034/iwp.103
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    References listed on IDEAS

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    More about this item

    Keywords

    Income Shock; General equilibrium; Health shock; Homeless; Housing;
    All these keywords.

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)

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