Hostname: page-component-76d6cb85b7-kcxw8 Total loading time: 0 Render date: 2026-07-14T10:22:44.106Z Has data issue: false hasContentIssue false
  • English
  • Français

The Political Economy of Ownership: Housing Markets and the Welfare State

Published online by Cambridge University Press:  02 May 2014

BEN ANSELL
BEN ANSELL*
Affiliation:
University of Oxford
*
Ben Ansell is Professor of Comparative Democratic Institutions, Department of Politics and International Relations and Professorial Fellow, Nuffield College, University of Oxford, New Road, Oxford, OX1 1NF, United Kingdom (ben.ansell@politics.ox.ac.uk).
Get access Rights & Permissions [Opens in a new window]

Abstract

The major economic story of the last decade has been the surge and collapse of house prices worldwide. Yet political economists have had little to say about how this critical phenomenon affects citizens’ welfare and their demands from government. This article develops a novel theoretical argument linking housing prices to social policy preferences and policy outcomes. I argue that homeowners experiencing house price appreciation will become less supportive of redistribution and social insurance policies since increased house prices both increase individuals’ permanent income and the value of housing as self-supplied insurance against income loss. Political parties of the right will, responding to these preferences, cut social spending substantially during housing booms. I test these propositions using both microdata on social preferences from panel surveys in the USA, the UK, and a cross-country survey of 29 countries, and macrodata of national social spending for 18 countries between 1975 and 2001.

Information

Type
Research Article
Information
American Political Science Review , Volume 108 , Issue 2 , May 2014 , pp. 383 - 402
Copyright
Copyright © American Political Science Association 2014 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Article purchase

Temporarily unavailable

References

REFERENCES

Armingeon, Klaus, Gerber, Marlène, Leimgruber, Philipp, and Beyeler, Michelle. 2008. “Codebook: Comparative Political Data Set I, 1960–2005.” Institute of Political Science, University of Berne.Google Scholar
Atterhög, Mikael. 2005. “Importance of Government Policies for Home Ownership Rates: An International Survey and Analysis.” Swedish Royal Institute of Technology.Google Scholar
Bartels, Larry. 2002. “Beyond the Running Tally: Partisan Bias in Political Perceptions.” Political Behavior 24 (2): 117–50.CrossRefGoogle Scholar
Busemeyer, Marius. 2009. “From Myth to Reality: Globalisation and Public Spending in OECD Countries Revisited.” European Journal of Political Research 48 (4): 455–82.Google Scholar
Cardarelli, Roberto, Igan, Deniz, and Rebucci, Alessandro. 2008. “The Changing Housing Cycle and the Implications for Monetary Policy.” IMF World Economic Outlook.Google Scholar
Carroll, Christopher. 1997. “Buffer-Stock Saving and the Life Cycle/Permanent Income Hypothesis.” The Quarterly Journal of Economics 112 (1): 1–55.Google Scholar
Carsey, Thomas, and Layman, Geoffrey. 2006. “Changing Sides or Changing Minds? Party Identification and Policy Preferences in the American Electorate.” American Journal of Political Science 50: 464–77.CrossRefGoogle Scholar
Case, Karl E., Shiller, Robert J., and Thompson, Anne K.. 2012. “What Have They Been Thinking?: Homebuyer Behavior in Hot and Cold Markets.” Brookings Papers on Economic Activity 2012 (2): 265–315.CrossRefGoogle Scholar
Castles, Francis. 1998. “The Really Big Trade-Off: Home Ownership and the Welfare State in the New World and the Old.” Acta Politica 33: 5–19.Google Scholar
Conley, Dalton, and Gifford, Brian. 2006. “Home Ownership, Social Insurance, and the Welfare State.” Sociological Forum 21 (1): 55–82.CrossRefGoogle Scholar
Cusack, Thomas, and Engelhardt, Lutz. 2002. “The PGL File Collection: File Structures and Procedures.” Wissenschaftszentrum Berlin für Sozialforschung.Google Scholar
Esping-Andersen, Gøsta. 1990. The Three Worlds of Welfare Capitalism. Cambridge, UK: Polity Press.Google Scholar
Estevez-Abe, Margarita, Iversen, Torben, and Soskice, David. 2001. “Social Protection and the Formation of Skills.” In Varieties of Capitalism, eds. Hall, Peter and Soskice, David. 145–83.CrossRefGoogle Scholar
Friedman, Milton. 1957. A Theory of the Consumption Function. Princeton, NJ: Princeton University Press.Google Scholar
Goldthorpe, John, Lockwood, David, Bechhofer, Frank, and Platt, Jennifer. 1969. The Affluent Worker in the Class Structure. New York: Cambridge University Press.Google Scholar
Hacker, Jacob. 2006. The Great Risk Shift: The Assault on American Jobs, Families, Health Care, and Retirement and How You can Fight Back. New York: Oxford University Press.Google Scholar
Hall, Peter, and Soskice, David. 2001. Varieties of Capitalism: The Institutional Foundations of Comparative Advantage. New York: Oxford University Press.Google Scholar
Huber, Evelyn, and Stephens, John D.. 2001. Development and Crisis of the Welfare State: Parties and Policies in Global Markets. Chicago: University of Chicago Press.CrossRefGoogle Scholar
Iversen, Torben, and Soskice, David. 2001. “An Asset Theory of Social Policy Preferences.” American Political Science Review 95 (4): 875–94.CrossRefGoogle Scholar
Kemeny, Jim. 1981. Myth of Home-ownership. London: Routledge.Google Scholar
Kingston, Paul, Thompson, John, and Eichar, Douglas. 1984. “The Politics of Homeownership.” American Politics Research 12 (2): 131–50.Google Scholar
Laderman, Elizabeth, and Reid, Carolina. 2008. “Lending in Low-and Moderate-Income Neighborhoods in California: the Performance of CRA Lending during the Subprime Meltdown.” Federal Reserve Bank of San Francisco Working Paper, 2008–5.Google Scholar
Lindert, Peter. 2004. Growing Public: Social Spending and Economic Growth since the Eighteenth Century, Vol. 1. New York: Cambridge University Press.Google Scholar
Mares, Isabela. 2003. The Politics of Social Risk: Business and Welfare State Development. New York: Cambridge University Press.Google Scholar
Margalit, Yotam. 2013. “Explaining Social Policy Preferences: Evidence from the Great Recession.” American Political Science Review 107 (1): 80–103.CrossRefGoogle Scholar
Meltzer, A. H., and Richard, S. F.. 1981. “A Rational Theory of the Size of Government.” The Journal of Political Economy 89 (5): 914–27.CrossRefGoogle Scholar
Mian, Atif, Sufi, Amir, and Trebbi, Francesco. 2010. “The Political Economy of the US Mortgage Default Crisis.” American Economic Review 100 (5): 1967–98.CrossRefGoogle Scholar
Modigliani, Franco, and Brumberg, Richard. 1954. “Utility analysis and the consumption function: An interpretation of cross-section data.” In Post-Keynesian Economics. New Brunswick: Rutgers University Press.Google Scholar
Prasad, Monica. 2012. The Land of Too Much: American Abundance and the Paradox of Poverty. Cambridge, MA: Harvard University Press.Google Scholar
Rajan, Raghuram. 2010. Fault Lines. Princeton, NJ: Princeton University Press.Google Scholar
Rehm, Philipp. 2011. “Social Policy by Popular Demand.” World Politics 63 (2): 271–99.Google Scholar
Rehm, Philipp, Hacker, Jacob, and Schlesinger, Mark. 2012. “Insecure Alliances: Risk, Inequality, and Support for the Welfare State.” American Political Science Review 106 (2): 386–406.Google Scholar
Rodrik, Dani. 1998. “Why do More Open Economies Have Bigger Governments?” Journal of Political Economy 106 (5): 997–1032.Google Scholar
Scheve, Kenneth, and Slaughter, Matthew. 2001. “What Determines Individual Trade-Policy Preferences?” Journal of International Economics 54: 267–92.Google Scholar
Schwartz, Herman. 2009. Subprime Nation: American Power, Global Capital, and the Housing Bubble. Ithaca: Cornell University Press.Google Scholar
Schwartz, Herman, and Seabrooke, Leonard. 2008. “Varieties of Residential Capitalism in the International Political Economy.” Comparative European Politics 6 (3): 237–61.Google Scholar
Scruggs, Lyle. 2004. “Welfare State Entitlements Data Set: A Comparative Institutional Analysis of Eighteen Welfare States.” Data set. Version 1: 1977–2002.Google Scholar
Shiller, Robert. 2007. Irrational Exuberance. Princeton, NJ: Princeton University Press.Google Scholar
Stegmueller, Daniel. 2013. “Modeling Dynamic Preferences: A Bayesian Robust Dynamic Latent Ordered Probit Model.” Political Analysis 21 (3): 314–33.Google Scholar
Teorell, Jan, Samanni, Marcus, Charron, Nicholas, Holmberg, Sören, and Rothstein, Bo.. 2010. The Quality of Government Dataset. University of Gothenburg: The Quality of Government Institute.Google Scholar
Verberg, Norine. 2000. “Homeownership and Politics: Testing the Political Incorporation Thesis.” Canadian Journal of Sociology 25 (2): 169–95.Google Scholar
Supplementary material: PDF

Ansell Supplementary Material

Supplementary Material

Download Ansell Supplementary Material(PDF)
PDF 137.4 KB
Submit a response

Comments

No Comments have been published for this article.