University of Wisconsin–Madison
Discussion Paper Icon

The Benefits and Costs of the Section 8 Housing Subsidy Program: A Framework and First-Year Estimates

The Section 8 housing voucher program serves nearly 2 million low-income families in the United States. The purpose of the program is to enable low-income families to improve the quality of their housing and to move to better neighborhoods. Voucher recipients seek housing in the private rental market, and use the voucher to subsidize their rent. In this paper, the authors provide estimates of the social benefits and costs of the Section 8 housing subsidy program. The authors find that the Section 8 program meets the efficiency standard of positive net benefits. For society as a whole, total benefits (measured in annual, per recipient units) range from about $7,700 to $9,600, while total costs are about $7,000; net benefits range from about $650 to $2,800 per recipient case per year. The social benefit-cost ratio ranges from 1.1 to 1.37. The bulk of the benefits are experienced by voucher recipients, while other members of society bear the bulk of the costs. The authors conclude that the program meets the efficiency standard of welfare economics.

Categories

Economic Support, Housing, Housing Assistance, Means-Tested Programs

Tags

,