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Title: What are the social benefits of homeownership? Experimental evidence for low-income households.

Citation Type: Journal Article

Publication Year: 2010

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Abstract: We estimate the social benefits of homeownership using an exogenous instrument based on randomly assigned treatment status from a field experiment that subsidized saving for home purchase for low income renters through Individual Development Accounts (IDAs). This approach attempts to eliminate the potential correlation present in previous analyses between unobserved individual characteristicsleading to homeownership and traits leading to provision of social capital or local amenities. Consistent with previous work, we show that homeownership positively affects political engagement in simple probits. Instrumental variable probits, however, show no impact of homeownership on political involvement. IV results for other social outcomes are less conclusive. The analysis suggests that with the use of an exogenous instrument, it is possible to generate results that are different from the previous literature. Our results also suggest that being eligible to open an IDA did not spur households to provide more socialcapital or local amenities.

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Authors: Engelhardt, Gary V.; Mills, Gregory B.; Eriksen, Michael D.

Periodical (Full): Journal of Urban Economics

Issue: 3

Volume: 67

Pages: 249-258

Data Collections: IPUMS USA

Topics: Housing and Segregation

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