Long-Term Effects of Public Low-Income Housing Vouchers on Work, Earnings, and Neighborhood Quality

The federal Section 8 housing program provides eligible low-income families with an income-conditioned voucher that can be used to lease privately owned, affordable rental housing units. This paper extends prior research on the effectiveness of housing support programs in several ways. We use a quasi-experimental, propensity score matching research design, and examine the effect of housing voucher receipt on neighborhood quality, earnings, and work effort. Results are presented for a wide variety of demographic groups for up to five years following voucher receipt. The analysis employs a unique longitudinal dataset that was created by combining administrative records maintained by the State of Wisconsin with census block group data. The results of our propensity score matching procedure show voucher receipt to have no effect on neighborhood quality in the short-term, but positive long-term effects. Furthermore, the results indicate that on average voucher receipt causes lower earnings in the initial years following receipt, but that these negative earnings effects dissipate over time. Finally, we find that recipient responses to voucher receipt differ substantially across demographic subgroups.