Government by Grant: The Case of Housing Renovation

DOI10.1177/095207679100600302
AuthorG.A. Boyne,J.A. Hunter,A.I. Millington
Publication Date01 December 1991
SubjectArticles
7
Government
by
Grant:
The
Case
of
Housing
Renovation
G.
A.
Boyne,
Polytechnic
of
Wales
A. I.
Millington,
University
of Bath
J.
A.
Hunter,
Polytechnic
of
Wales
Abstract
Public
policies
increasingly
consist
of
attempts
by
governments
to
modify
market
processes.
A
major
market
based
policy
instrument
is
the
payment
of
cash
incentives
to
private
individuals
and
organisations.
This
paper
evaluates
the
success
of
one
such
policy,
housing
grants
which
are
intended
to
stimulate
renovation
activity.
A
statistical
model
of
renovation
by
private
households
is
specified
and
tested.
The
explanatory
variables
in
the
model
include
grants,
local
property
taxes
and
measures
of
the
characteristics
of
dwellings,
households
and
local
neighbourhoods.
The
empirical
evidence
shows
that
grants
largely
substitute
for
private
renovation
activity.
Much
grant
funding
simply
pays
for
renovation
work
that
would
have
been
undertaken
anyway,
and
is
effectively
a
general
income
transfer
to
grant
recipients.
Conclusions
are
drawn
on
the
design
of
housing
grants
and
market-based
policies
in
general.
The
pattern
of
public
policies
in
Western
democracies
has
altered
substantially
in
the
last
decade.
Instead
of
providing
services
or
undertaking
tasks
directly,
governments
have
sought
to
modify
the
behaviour
of
individuals
and
organisations
in
the
private
sector.
Thus
policies
have
become
more
’market
based’,
in
the
form
of
subsidies
to
consumers
and
producers
(Fasenfest,
1986).
A
major
method
of
influencing
activity
in
the
private
sector
is
the
provision
of
cash
grants.
This
policy
instrument
became
an
increasingly
important
element
of
housing
programmes
in
the
1980’s
(see
Galster,
1987
on
the
USA;
and
Thomas,
1986
on
the
UK).
The
payment
of
grants
assumes
that
public
money
can
lure
private
behaviour
in
the
direction
that
governments
desire.
Thus
evidence
on
the
effect
of
renovation
grants
has
implications
not
only
for
housing
policies
in
particular,
but
also
for
market
based
public
policies
in
general.
It
has
been
argued

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