The impact of housing non-cash income on the unconditional distribution of household income in Austria

Arbeitspapier

We estimate non-cash income from owner occupied housing, subsidized rental housing, or free use of one's main residence and evaluate their impact on the unconditional distribution of household income and selected inequality measures. We confirm the standard finding in the literature that imputed rents accruing to home owners have an equalizing effect on the distribution of income and find similar evidence for non-cash income from subsidized rents. Whereas imputed rents equalize the upper part of the income distribution, subsidized housing has an equalizing effect on the lower part of the income distribution. Overall, the effect of non-cash income from owner occupied housing clearly dominates the distributional effects, which translates into a combined effect of around 15% higher income for the bottom half and around 10% for the upper half of the unconditional income distribution. Our data provide us with the rare opportunity to apply all three commonly used approaches to calculate imputed rents for owner occupiers: capital-, self-assessment and equivalent rent approach. We find that using the equivalent rent approach leads to the strongest reduction in income inequality.

Object Details

• ISBN: 978-92-899-1085-9
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ECB Working Paper ; No. 1718

Classification and Topics

• Classification: Wirtschaft ; Consumer Economics: Empirical Analysis ; Household Saving; Personal Finance ; Personal Income, Wealth, and Their Distributions
• Subject: household main residence ; housing policies ; imputed rent ; income distribution ; non-cash income ; subsidized rent

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Fessler, Pirmin ; Rehm, Miriam ; Tockner, Lukas
• Event: Veröffentlichung
• (who): European Central Bank (ECB)
• (where): Frankfurt a. M.
• (when): 2014

Further information

• Handle: http://hdl.handle.net/10419/154151
• Last update: 10.03.2025, 11:45 AM CET