Offsetting Risk in a Neoliberal Environment: The Link between Asset-Based Welfare and NIMBYism

Matthew C Record

doi:10.3390/jrfm14110547

Abstract

Affordable housing policy in the developed world has been undergoing a systematic commodification for several decades, including a push for homeownership as the normalized tenure and a commodity unto itself. Scholars suggest this push for homeownership is part and parcel of a neoliberal asset-based welfare to supplement, or even outright replace, traditionally defined benefit pension schemes. These policies individualize risk and re-fashion individual citizens as long-term financial planners, navigating the uncertainty inherent in international financial markets and general financial management. Less deeply explored, however, are the perverse incentives this system creates for homeowners to protect their home “investment” by leveraging planning policies, zoning, and land-use restrictions to preserve the community status quo and lock in the value of their home. In a policy environment in which long-term financial risk is individualized and public social welfare and pension systems are relegated to the smallest number of individuals possible, this type of NIMBYism (Not in My Backyard) is rather rational behavior, even as it simultaneously staunches the supply of new housing and drives up prices for non-homeowners. As such, this analysis synthesizes the existing research to make a formal theoretical connection between the neoliberal push for commodified housing, asset-based welfare, and the intractable political problem of NIMBYism.

Highlights

One of the most daunting policy problems facing much of the developed world is the increasing unaffordability of housing and the political motivations that make providing sufficient housing stock so difficult
Affordable housing policy in the developed world has been undergoing a systematic process of commodification across multiple dimensions of the policy sub-system (Dewilde and De Decker 2016; Di Feliciantonio and Aalbers 2018; Ronald 2008)
Most developed countries have shifted their focus away from affordable housing to policies that focus on homeownership, irrespective of cost, and in the west (Dewilde and De Decker 2016; Di Feliciantonio and Aalbers 2018; Jones and Watkins 2009; Saegert et al 2009)

Summary

Introduction

One of the most daunting policy problems facing much of the developed world is the increasing unaffordability of housing and the political motivations that make providing sufficient housing stock so difficult. The push for homeownership serves as a justification for the commodification of other policy systems as well, most notably social insurance and welfare provision Under this paradigm, the imputed rent associated with owning one’s home along with the store of wealth homeownership provides can serve as a source of welfare into old age, reducing the need for public pensions and other forms of direct old-age benefits from the state (e.g., André and Dewilde 2016; Castles 1998; Chia and Tsui 2019; Delfani et al.2014; Doling and Elsinga 2012; Kemeny 2005). As the theoretical arguments to follow are laid out, these types will demonstrate when trends confine themselves to specific housing and public pension structures and when these same trends cross typological lines

The Neoliberal Preference for Homeownership

Percent

Asset-Based Welfare as an Incentive for Exclusionary Land Use

Conclusions