The Fiscal Policy Dimension

Abstract

This chapter emphasizes the implicit fiscal dimension of housing polices. This perspective shows how a traditional public finance perspective on the rather modest levels of government spending in the sector is misleading. For understanding the government’s role in the housing sector, it is less government’s spending than implicit taxes and subsidies which are the major policy instruments. The chapter also presents evidence on how the sector has been affected by the way the world’s more volatile financial environment has interacted with these implicit policies.