Housing Benefits and Labor Decisions: Evidence from a Regression Discontinuity Design

Abstract

How do labor decisions change in response to receiving housing benefits? This thesis examines the impact of housing benefit receipt on household earnings, employment, and work-related relocation using Dutch housing survey data within a fuzzy regression discontinuity design. This method effectively mitigates selection bias from self-enrolment into welfare programs. The results provide limited evidence that single-person households reduce their labor supply when receiving housing benefits. However, no significant effects on employment probability or mobility outcomes are found. The analysis also reveals considerable treatment effect heterogeneity across demographic subgroups. For multi-person households, no causal effect could be identified due to a lack of housing benefit uptake amongst eligible recipients. These findings alleviate concerns about housing assistance policies significantly disincentivizing employment. Lars Adriaanse