Housing allowances, mobility and crowded living: the Norwegian case

Abstract

Housing allowances should enable economically weak households to accommodate in good qualitatively housing . Utilising a special feature of the Norwegian h ousing allowance system , we study how housing allowances affect the incidence of crowded living and mobility. We investigate housing market behaviour in a treatment group in a situation in which variations in housing situation feeds directly into variations in the amount of hous ing allowances received . This is compared it to the behaviour of a control group in a situation where variations in the housing market behaviour do not feed into variations of the amount of housing allowances received. Our empirical analyses reveal that t he probability of moving out of crowded housing conditions is 14 percent higher among housing allowance receivers whose amount of housing allowances is affected by marginal variations in the pre - allowance housing expenses, than in the control group . The fi ndings of this paper could have implications for the way housing allowance systems is designed and revised.