Essays in the economics of public housing policy

Lee, Han Bum

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Description

Title

Essays in the economics of public housing policy

Author(s)

Lee, Han Bum

Issue Date

2015-11-30

Director of Research (if dissertation) or Advisor (if thesis)

McNamara, Paul E.

Doctoral Committee Chair(s)

McNamara, Paul E.

Committee Member(s)

• Arends-Kuenning, Mary Paula
• Xu, Yilan
• Powers, Elizabeth T.
• Greenlee, Andrew

Department of Study

Agricultural & Consumer Economics

Discipline

Agricultural & Applied Economics

Degree Granting Institution

University of Illinois at Urbana-Champaign

Degree Name

Ph.D.

Degree Level

Dissertation

Keyword(s)

• Poverty
• Public Housing Programs
• Moving to Work
• Self-Sufficiency
• Psychological Well-Being
• Locational Choice

Abstract

This dissertation presents three studies of an economic analysis of federally-funded housing assistance programs on the quality of a recipient’s locational decisions, psychological well-being, and labor market outcomes. It features a restricted-use of the administrative data (household-level) and self-reported social survey, conducted by the Moving to Work (MTW) Project Research Lab at the University of Illinois between 2012 and 2014, providing the opportunity to evaluate current policy initiatives under the MTW demonstration in Champaign County, Illinois. The first chapter explores the role of costs of moving in Housing Choice Voucher (HCV) households’ locational choices, and identifies mobility-disadvantaged groups, in the sense of having a high-level of costs of moving, by comparing different levels of disutility based on recipients’ characteristics. I choose households that receive housing vouchers from 2008 to 2010 in the twin cities of Champaign-Urbana in Illinois, and track their residential locations using restricted-use administrative data. I also adopt the Mixed Logit (ML) model to model residential location choices, incorporating recipients’ heterogeneous preferences over costs of moving factors, as well as other various dimensions of dwelling and neighborhood attributes. Our main findings suggest that the HCV households are responsive to costs of moving factors indicating that there is a strong disincentive for the internal relocation costs, such as costs of reluctance to leave the familiar surroundings (social ties), and search costs for housing and daily-use facilities in potential destination neighborhoods. Also, the results from the ML model reveal a high-level of statistical significance of heterogeneity in preferences among the HCV households, providing empirical evidence to support that recipients would face different levels of costs of moving based on their characteristics. Moreover, the comparison of the distribution of individual-level random coefficients for costs of moving factors among defined mobility-disadvantaged groups is analyzed. In the second and third chapters, I present an interim evaluation of the MTW self-sufficiency program on participants’ psychological well-being and labor market outcomes. As of 2010, the HACC has joined the MTW demonstration, and the MTW self-sufficiency program has taken effect in Champaign County, Illinois, from January 2013. Specifically, under the self-sufficiency statutory objective, the HACC requires all working-age (18-54), able-bodied (non-disabled) family members to work a certain number of hours or attend job training, educational institutions, or programs that assist recipients to obtain employment and achieve economic independence within the certain years. Moreover, MTW PHAs enforce participation in Local Self-Sufficiency (LSS) programs that assists in advising on career planning and assessing barriers to employment of non-compliant households. Also, if a participating household maintains a continuous state of non-compliance until the next re-certification, then a penalty or sanction will be imposed to the household to compel compliance or to limit its welfare benefits, often resulting in loss of subsidy. Since the program could work through multiple channels to influence heads’ psychological well-being and labor market outcomes, I calculate the average program effects estimated by the Difference-in-Differences models. My study makes use of the self-reported survey, referred to as “Housing and Self-Sufficiency Social Survey,” which includes questionnaire items which assess respondents’ psychological well-being, as well as household-level socioeconomic characteristics for the treatment and control group households. For this analysis, I followed head of households that completed the surveys in 2012 and 2014. In the body of the dissertation, I present a detailed discussion of the analysis on attrition and balancing tests, as well as the applied econometric models to understand the findings. In the second chapter, I find that, in the short-run, the MTW self-sufficiency program leads to an increase of case heads’ depression (CES-D) and a decrease of hopefulness (ATH); however, there is no significant short-run impact on anxiety (GAD). These results can be explained by the fact that, overall, the adverse effects, derived from challenges and hardships to fulfill self-sufficiency requirements, dominate other effects in the short-run. We also hypothesize that non-white and low-educated head of households may suffer more from psychological stress. We indeed observe a larger negative impact in hopefulness (ATH) and depression (CES-D), lending support to our hypothesis that heads of low-socioeconomic status may face greater levels of psychological stress. The findings in the third chapter suggest that, in the short-run, the MTW self-sufficiency program leads to a significant increase in participants’ probability of working in the labor force (7.8-10.3 percentage-points) and number of weekly hours worked (3.0-3.7 hours). We also hypothesize that the MTW self-sufficiency program may have larger effect sizes in head of households with relatively less barriers to employment (such as heads with no criminal history, and having at least a high-school diploma or GED). On the other hand, we expect that the program may have relatively lower effect sizes in single mother households since they are often thought to be the most disadvantaged group which may experience further barriers to economic self-sufficiency. Our results lend support to the first hypothesis that the program has a larger impact on labor market outcomes of the participants with less barriers to employment; however, we do not find the statistical short-run impact for single mother households.

Graduation Semester

2015-12

Type of Resource

text

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Copyright 2015 Han Bum Lee

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