Abstract
Most of the advanced welfare states of the world are committed to ensuring that housing is affordable to ordinary citizens. Shelter is not only a necessity, but for most households it is also the largest single item in their budget. For low-income households in particular, the ratio of housing expenditure to income can be high. Governments provide assistance in the form of housing allowances — income-related subsidies tied to housing that are paid to consumers (or directly to landlords on their behalf). This chapter discusses housing allowance schemes, the role of housing allowances, designing housing allowances, housing and labour market disincentives, and fiscal pressures.
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