Abstract

The lack of housing in areas where young adults have greater opportunities to study and get work complicates young adults’ entry into the adulthood. Difficulties in accessing housing may therefore delay childbearing and may negatively have an effect on education opportunities. To increase housing accessibility, some municipalities have earmarked apartments for young adults. These “youth dwellings” are criticized for being small and not necessarily facilitating family formation and fertility, better suiting students’ needs. We have in this paper compared the long-term pattern of childbearing and education for young adults that entered their housing market through small cheap youth housing with those youngsters that received a rental apartment from the ordinary housing stock. To be able to draw the conclusion that differences in fertility and educational pattern between these two groups comes from the different housing situation and not from differences in in preferences when it comes to childbearing or individual prerequisites for higher education, we have used a geocoded data and information on the individual’s family background as well as a matching technique to create a comparison group that are similar to the treatment group in several aspects. The present results indicate that building affordable housing that is small and space efficient is sufficient and positive if the aim is to promote higher education. Affordable housing is on the other hand not enough to promote childbearing, instead, it seems to inhibit childbearing until there is a possibility of moving on in the housing career. Our result also indicates that the next step need not necessarily be homeownership, as earlier research has indicated. Entering the housing market via youth housing and then being able to move on to rental accommodation in the ordinary housing market also seems to have a positive effect on overall childbearing, although moving to cooperative housing or owned housing has an even larger effect.

Highlights

  • The increase in adult children living with their parents has raised important questions regarding household formation

  • The point of departure of this study was to examine the effect of youth dwellings, i.e., apartments earmarked for young adults, on young adults’ childbearing and education patterns

  • Young adults who leave the parental home for education may have little latitude for postponement and may obtain an education despite living in substandard housing

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Summary

Introduction

The increase in adult children living with their parents has raised important questions regarding household formation. If young people succeed in leaving the parental home and enter the housing market in a small dwelling, this may positively affect childbearing if subsequent access to high-quality housing is easy. If such housing is scarce, prices are high, and/or mortgage providers are strict, young people might postpone childbearing until they find a house suitable for family formation, which may reduce the number of children born (cf Chiuri & Jappelli, 2003). The paper ends by presenting the conclusions and discussing the policy implications of the present findings

Theory of housing and household formation
The Swedish housing market
Data and sample
Propensity score and matching
Empirical strategy
Becoming parent
Higher education
Sensitivity tests
Findings
Conclusions and policy implications
Full Text
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