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commitment to ensuring that all citizens can access affordable housing
(Ditch et al., 2001). However, housing assistance systems vary significantly
from country to country and from time to time to meet new policy
recommendations. The results of the present study suggest that a housing
allowance tied to the particular housing situation indeed affects housing
consumption. Housing allowances seek to induce households to move into
better housing, thereby increasing their housing consumption. By contrast,
imposing dwelling size constraints instead seems to create a lock-in effect,
and the size limit imposed in Sweden’s 1997 housing allowance reform
increased the likelihood of a household experiencing overcrowding.
The next section, section 2, begins by discussing some theoretical issues
concerning housing allowance and the implications of the size limit. Section
3 presents the data and the empirical strategy, section 4 presents the
analysis and results, while section 5 concludes the paper.
