Behavioral Responses to Mortgage Revenue Bond Subsidies: Effects on Efficiency and Distribution
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The policy debate about mortgage revenue bond (MRB) programs has addressed both the efficiency and distribution of the loan subsidies. Strong theoretical arguments and some empirical evidence have supported the conclusion that MRB programs are inefficient, yielding less in benefits than they cost (Congressional Budget Office 1979; Tuccillo and Weicher 1979; Peterson and Cooper 1979; Lurie 1982; General Accounting Office 1983, 1988; and the California Office of Legislative Analyst 1985). Also, a small amount of empirical research has shown that a majority of the subsidies has been distributed to households with above-median incomes (General Accounting Office 1983, 1988; chapter 4 in this book).
KeywordsHouse Price Price Elasticity Sales Price Housing Service Market Interest Rate
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