Government policy or household choice: What drives housing outcomes in the Gambia

Numerous undeveloped residential plots and incomplete housing projects in Greater Banjul testify to significant difficulties faced by households endeavoring to create dwelling units. These are prevalent in high income areas and on government-allocated residential subdivisions where, typically, the state has subsidized critical inputs. If land and other housing "bottlenecks" are provided at minimal cost, why does housing delivery remain so low? This research attempts to identify which factors determine successful delivery of housing. It focuses on cases where households desirous of home-ownership are compelled to develop their own, and assesses how policies facilitate or impede plot development.;The principal thesis is that housing outcomes reflect patterns of consumption which are, in turn, driven by an "enterprise imperative" for lower class households and a "prestige imperative" for upper class households. To test this hypothesis, I use demographic variables to classify households into socioeconomic categories and policy variables to construct formal and nonformal housing delivery systems. There is evidence of strong correlation between households of high socioeconomic status and formal delivery systems that offer subsidized inputs to housing. Lower class households lack access to the formal sector, and are compelled to operate in nonformal or customary systems with minimal government assistance. The configuration of political authority, the "status quo," skews subsidies to those households that are most effective at articulating demand on housing institutions, and this results in inequitable outcomes.;That finding is not surprising. It is not even new. The more important conclusion is that the outcomes are also inefficient and constitute a barrier to the government's own policy goals of expanding the supply of urban housing. Driven by the "enterprise" goals, lower status households produce more residential, commercial, and other structures per plot, and are--in fact--a more effective conduit through which to achieve desired outcomes. Upper class households, despite government assistance, take longer periods to complete construction and produce less housing. There are also equity implications. The excluded households have less education and have lower incomes. They are more "needy" and thus put forth a strong case for policy assistance.;To the extent possible, government should target subsidies at low income households for reasons of efficiency and equity. If targeting is not feasible, policy action should produce outputs that are collectively rather than privately consumed. Household choices are as important as more traditional policy variables that, at best, are intervening mechanisms. However, while the impact of prices is thoroughly researched and well understood, the "household" factor is neglected in housing research.