The Efficiency of Demand-Oriented Housing Programs: Generalizing from Experimental Findings

Typical production-oriented housing programs offer potential recipients a highly limited set of previously unattainable commodity bundles. From the household's viewpoint, such programs have been highly inefficient. From society's viewpoint, such housing programs are generally horizontally inequitable and inefficient. Given that housing programs are not likely to be fully cashed out and incorporated into general income maintenance, could housing programs be restructured to increase their efficiency? This paper examines this question. Results indicate that demand-oriented housing programs are substantially more efficient than are production-oriented programs. In fact, in the aggregate, the former programs approach unrestricted cash payments in their transfer efficiency.