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Enabled to work: The impact of government housing on slum dwellers in South Africa

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  • Franklin, Simon

Abstract

Do informal housing conditions constrain labour supply? I estimate the effect of receiving a free house under the South African government’s housing program, which has given away over 3 million housing units since 1994. Using four waves of household panel data from Cape Town and geographical data on the location of large housing projects, I exploit a natural experiment whereby households living close to projects were first in line to get them to instrument for selection into the programme. I use projects that were planned and approved, but never actually built, to deal with non-random placement of housing projects. Government housing has a significant positive effect on household earnings. This is driven primarily by increases in earnings for women. I present evidence consistent with a mechanism whereby formal housing frees up time by alleviating the demands of work in the home.

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  • Franklin, Simon, 2020. "Enabled to work: The impact of government housing on slum dwellers in South Africa," Journal of Urban Economics, Elsevier, vol. 118(C).
    • Handle: RePEc:eee:juecon:v:118:y:2020:i:c:s009411902030036x
    DOI: 10.1016/j.jue.2020.103265
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    2. Zhang, Li & Xie, Lunyu & Zheng, Xinye, 2023. "Across a few prohibitive miles: The impact of the Anti-Poverty Relocation Program in China," Journal of Development Economics, Elsevier, vol. 160(C).
    3. Guy Michaels & Dzhamilya Nigmatulina & Ferdinand Rauch & Tanner Regan & Neeraj Baruah & Amanda Dahlstrand, 2021. "Planning Ahead for Better Neighborhoods: Long-Run Evidence from Tanzania," Journal of Political Economy, University of Chicago Press, vol. 129(7), pages 2112-2156.
    4. Manea, Roxana Elena & Piraino, Patrizio & Viarengo, Martina, 2023. "Crime, inequality and subsidized housing: Evidence from South Africa," World Development, Elsevier, vol. 168(C).
    5. Adriana Camacho-González & Jorge Enrique Caputo-Leyva & Fabio Sánchez-Torres, 2022. "A new beginning: The effect of the free housing program on the quality of life of beneficiary households," Documentos CEDE 20303, Universidad de los Andes, Facultad de Economía, CEDE.
    6. Kumar, Tanu, 2021. "The housing quality, income, and human capital effects of subsidized homes in urban India," Journal of Development Economics, Elsevier, vol. 153(C).
    7. Omer Ozgen, 2020. "Impact of Slum Redevelopment Projects on Labour Market Outcomes: Evidence from Addis Ababa," CSAE Working Paper Series 2020-23, Centre for the Study of African Economies, University of Oxford.
    8. Choumert-Nkolo, Johanna & le Roux, Leonard, 2024. "Leaving the hearth you know: Internal migration and energy poverty," World Development, Elsevier, vol. 180(C).
    9. Paul Collier & Anthony J. Venables, 2013. "Housing and Urbanization in Africa: unleashing a formal market process," CSAE Working Paper Series 2013-01, Centre for the Study of African Economies, University of Oxford.
    10. Adriana Camacho-González & Jorge Enrique Caputo-Leyva & Fabio Sánchez-Torres, 2022. ""Un nuevo comienzo": El impacto del Programa Vivienda Gratuita sobre la calidad de vida de los hogares beneficiarios," Documentos CEDE 20077, Universidad de los Andes, Facultad de Economía, CEDE.
    11. Leonard Le Roux & Johanna Choumert-Nkolo, 2023. "Internal Migration and Energy Poverty," Working Papers 2023.01, FAERE - French Association of Environmental and Resource Economists.
    12. Posada, H. M. & García, A. F. & Londoño, D, 2022. "The external effects of public housing developments on informal housing: The case of Medellín, Colombia," Documentos de Trabajo 20416, Universidad del Rosario.
    13. Simon Franklin, 2015. "Location, search costs and youth unemployment: A randomized trial of transport subsidies in Ethiopia," CSAE Working Paper Series 2015-11, Centre for the Study of African Economies, University of Oxford.
    14. Li Shang & Xiaoling Zhang & Decai Tang & Xiaoxue Ma & Chunfeng Lu, 2023. "The Impact of Housing Support Expenditure on Urban Residents’ Consumption—Evidence from China," Sustainability, MDPI, vol. 15(12), pages 1-24, June.
    15. Bradlow, Benjamin H. & Polloni, Stefano & Violette, William, 2023. "Public housing spillovers: Evidence from South Africa," Journal of Urban Economics, Elsevier, vol. 134(C).
    16. Zou, Jing & Deng, Xiaojun, 2022. "Housing tenure choice and socio-economic integration of migrants in rising cities of China," China Economic Review, Elsevier, vol. 74(C).

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    More about this item

    Keywords

    Housing; Informal settlements; Labor supply; Domestic labor; South Africa; Government housing;
    All these keywords.

    JEL classification:

    • P14 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Property Rights
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation

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