No abstract

In the postwar period Sweden has undertaken extensive political interventions for the purpose of achieving social housing goals. Today, the Swedish housing standard is one of the highest in the world with virtually all households provided adequate shelter. Yet, serious reservations concerning both efficiency and equity must be raised with respect to the Swedish model .In the developed economies there appear to be three broad forms of social organization for the housing sector : (i) a market model, (ii) a planning model, and (iii) a welfare state model . The market model represents a social decision-making process where housing resources are allocated largely via the information channels and incentives of the price mechanism . In contrast, the planning model is a social choice process where housing resources are allocated by a central plan . However, there also appears to be a third general alternative, a welfare state model, that is distinct from both market and planning models . Two integral components of this model are administrative pricing, usually within a large rental sector, and a significant not-for-profit sector . Thus, while housing resources are guided to an extensive degree by political/administrative decision-making, the housing sector is neither co-ordinated nor controlled by the information or incentive structures of the price mechanism . Nor does a central planning process fulfill these functions .The primary purpose of this paper is an assessment of the welfare state model in housing . This will be done by focussing on the Swedish decision-making model, Sweden being arguably the world's most successful welfare state. A secondary purpose is to [Received March 1981 ]

Most housing policy analyses conclude that housing is a commodity that cannot be efficiently and equitably allocated via the market process. Major contentions in this respect are that market allocation will result in suboptimal housing investment and that the market process leads to the creation of slums. Furthermore, the proponents of the welfare housing model argue that welfare state interventions have raised the average level of housing consumption above the level that would have been achieved under a more market-oriented allocative model. However, both theory and evidence fail to support these beliefs.

The purpose of this study is to present a comparative economic systems evaluation of the Swedish housing model. The evaluation examines success in achieving equity as well as efficiency goals and incorporates key comparisons with the market-oriented US housing model. From the late 1940s up to the major housing reforms of the early 1990s, a form of strong economic planning characterised the Swedish housing sector. By the early 1970s, the housing standard for all income-groups had been raised markedly and urban slums eliminated. Yet, Sweden's success came at huge resource cost while at the same time important equity goals were compromised. For example, Swedish building costs are among the highest in the world while in Sweden's major cities socioeconomic segregation is more pronounced than ever before in the post-war period.