Moving to Opportunity or Isolation? Network Effects of a Randomized Housing Lottery in Urban India

Abstract

A housing lottery in an Indian city provided winning slum dwellers the opportunity to move into improved housing on the city's periphery. Fourteen years later, winners report improved housing but no change in tenure security, family income, or human capital. Winners also report increased isolation from family and caste networks and reduced informal insurance. We observe significant program exit: 34 percent of winners never took up subsidized housing and 32 percent eventually exited. Our results suggest negligible long-run economic value of this expensive public program and point to the importance of considering social networks in housing programs for the poor. (JEL I38, O15, O18, R23, R31, R38, Z13)