Magazine article Chicago Policy Review (Online)

Housing Relocation in Developing Countries: Opportunity or Isolation?

Magazine article Chicago Policy Review (Online)

Housing Relocation in Developing Countries: Opportunity or Isolation?

Article excerpt

Over the course of the last two decades, there has been a significant trend toward urbanization worldwide as the promise of jobs and wealth has driven many people to relocate. A record 54 percent of the world’s population now lives in urban areas, with the largest increases occurring in developing countries. However, this urban expansion has also caused a growing number of people to live in informal and even illegal settlements. In India, which boasts the second fastest growing economy among G20 countries, 24 percent of the urban population lives in slums. These individuals live in cramped spaces with inadequate amenities and typically hold low-paying jobs in informal sectors.

Many developing countries’ governments, including India’s, respond to this problem by providing opportunities for inhabitants of slums to relocate to subsidized public housing. For example, in 1987, the city government of Ahmedabad, which is located in Gujarat, India, along with the Self Employed Women’s Association (SEWA), which is a trade union for female workers, offered a housing lottery for beedi rolling workers who had a monthly income below 700 rupees, or $11 USD. The 110 winners were randomly selected out of 497 eligible women who participated in the lottery. The winners were given the opportunity to live in single-story 200-square-foot row houses with better amenities and located 7.5 miles from the city center. In order to move into the new housing, the winners made down payments of 900 rupees, or $14 USD. Their monthly rent was 124 rupees, or $2 USD, and they were guaranteed housing for 20 years.

Fourteen years after this endeavor, a study by Sharon Barnhardt et al., evaluated how this housing lottery affected the winners’ residential location, socioeconomic well-being, and social capital. The authors tracked the original 497 lottery participants and successfully surveyed 89 percent of them. They found that although all winners signed a lease agreement, 34 percent of them never moved into the subsidized public housing and another 32 percent moved in but returned to the slums within ten years. Only 34 percent remained in public housing at the time of the survey.

Compared to those who did not win the lottery, the winners indeed lived with better amenities - including durable walls and roofs, as well as private toilets. Surprisingly, however, the authors did not find any significant difference between the winners’ and losers’ socioeconomic well-being. …

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