Do housing and social policies make households too small? Evidence from New York
How many adults should live in a house? How do people actually divide themselves up among households? Average household sizes vary substantially, both over time and in the cross-section. In New York City, we find that housing and income maintenance policies exert powerful influences on household size and composition -- more powerful than race, culture, or ethnicity. These policies make households smaller (measured by number of adults). We review arguments why governments might want to influence household sizes, and discern no reason for trying to make households smaller than they would be in the absence of these housing and income maintenance policies. Small average household size can be extremely expensive in terms of physical and environmental resources, higher rents, and possibly homelessness. Our results indicate that New York City may well have too much of it.
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