Abstract
In this paper we estimate the tenant benefits and efficiency loss in public rental housing supplied by the local government on the basis of the data for private housing as well as public housing. In the estimation we specify a Cobb-Douglas utility function defined on housing attributes and other goods, and present a new form of Hicks equivalent variation taking into account implicit marginal prices. We analyze the relationship between benefits of public housing and subsidy for rent, defined as the difference between the market value of public housing and rent of public housing, and examine the distribution of the benefits by household characteristics. The study finds that the public housing benefits are ten per cent of the monthly income, and also indicates the effectiveness of public rental housing for low income households while the inefficiency for high income group.
