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Economic evaluation of housing subsidy systems: a methodology with application to Morocco

  • Le Blanc, David
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    Most countries do not use one single type of housing subsidy but combine many of them. The author provides operational criteria that allow evaluation of systems of housing subsidies, both at the individual program level and at the aggregate (country) level. The author examines the public finance assessment criteria used by different authors to analyze subsidy programs and confront them systematically. The author ends up with a map of criteria, which covers the range of topics interesting to policymakers. For each criterion, the author tries to provide empirical measures that can be retrieved from existing programs. The author then provides an aggregation method allowing a synthesis of diagnoses about the quality of the housing subsidies system at the country level. The aggregation technique offers a simple way to visualize the main features of a subsidy system, as well as the effects on the system of reforms or improvements of particular programs. The author applies the methodology to the system prevailing in Morocco in 1995 and 2004. The analysis shows that the most visible subsidies might not have been the most inefficient, nor the most resource consuming for the state. Examination of policy changes since 1995 shows that while the most visible subsidies received nearly all the government's attention, large invisible subsidies remain at the heart of Morocco's housing policy. The framework used here is very general and can be used to compare the Moroccan system with those of similar countries.

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    Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3529.

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    Date of creation: 01 Feb 2005
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    Handle: RePEc:wbk:wbrwps:3529
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    1. Heffley, Dennis, 1998. "Landlords, tenants and the public sector in a spatial equilibrium model of rent control," Regional Science and Urban Economics, Elsevier, vol. 28(6), pages 745-772, November.
    2. Koning, R.H. & Ridder, G., 1993. "Rent assistance and housing demand," Serie Research Memoranda 0041, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    3. Fu, Yuming & Somerville, C. Tsuriel, 2001. "Site Density Restrictions: Measurement and Empirical Analysis," Journal of Urban Economics, Elsevier, vol. 49(2), pages 404-423, March.
    4. Todd Sinai & Joel Waldfogel, . "Do Low Income Housing Subsidies Increase Housing Consumption?," Zell/Lurie Center Working Papers 394, Wharton School Samuel Zell and Robert Lurie Real Estate Center, University of Pennsylvania.
    5. Edgar O. Olsen, 2001. "Housing Programs for Low-Income Households," NBER Working Papers 8208, National Bureau of Economic Research, Inc.
    6. Kaushik Basu & Patrick M. Emerson, 2003. "Efficiency Pricing, Tenancy Rent Control and Monopolistic Landlords," Economica, London School of Economics and Political Science, vol. 70(278), pages 223-232, 05.
    7. Bertaud, Alain & Brueckner, Jan K., 2005. "Analyzing building-height restrictions: predicted impacts and welfare costs," Regional Science and Urban Economics, Elsevier, vol. 35(2), pages 109-125, March.
    8. Basu, Kaushik & Emerson, Patrick M., 2000. "The Economics of Tenancy Rent Control," Working Papers 00-04, Cornell University, Center for Analytic Economics.
    9. Crews Cutts, Amy & Olsen, Edgar O., 2002. "Are Section 8 housing subsidies too high?," Journal of Housing Economics, Elsevier, vol. 11(3), pages 214-243, September.
    10. Dietz, Robert D. & Haurin, Donald R., 2003. "The social and private micro-level consequences of homeownership," Journal of Urban Economics, Elsevier, vol. 54(3), pages 401-450, November.
    11. Gyourko, Joseph & Linneman, Peter, 1989. "Equity and efficiency aspects of rent control: An empirical study of New York City," Journal of Urban Economics, Elsevier, vol. 26(1), pages 54-74, July.
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