Rowe, Andy
(1991)
Self-help housing provision and capital accumulation in Atlantic Canada.
PhD thesis, London School of Economics and Political Science.
Abstract
A third of Canadian housing starts and half of the housing starts in Atlantic Canada are produced by self-help means, yet this important sector of housing provision has been overlooked by analysts of Canadian housing. The objective of this thesis is to examine self-help housing in Atlantic Canada, and by this means, improve the understanding of Canadian housing. The thesis begins by developing an economic theory of self-help housing provision. The application of this approach is not restricted to Canada; it has relevance for housing analysis in all industrialised countries, and to self-help housing in the Third World. In the third chapter estimates are made of the level of self-help housing in different regions of Canada. Self-help is estimated to account for at least half of all housing starts annually in Atlantic Canada, and a third of all Canadian housing starts. Ontario, Manitoba and Alberta are predicted to have the lowest level of self-help housing, while Saskatchewan, Quebec and British Columbia are predicted to have medium levels of self-help. Self-help is not a rural phenomenon, it is estimated to account for 22 percent of all housing starts in Census Metropolitan areas of Canada. Case study information from Atlantic Canada is used to describe self-help housing provisioning and there appears to be little difference between households using self-help as opposed to purchasing a dwelling built by the residential construction industry, or indeed between the dwellings built by the two sectors. While there are no differences in the quality or the suitability of dwellings built by the two sectors, self-help provisioning is far more affordable, and self-help households have a much higher level of financial security in their dwelling. The incidence of self-help cannot be predicted by different skill levels of the population or by factors such as a greater amount of time for self-help as a consequence of high rates of unemployment (while self-help provisioning is highest where unemployment rates are highest, self-help households are rarely unemployed, at least in the areas covered by the case studies). It is argued that self-help is best viewed as a sector of housing provision, and is more likely to occur in areas where the residential construction industry has greatest difficulty obtaining profits from the production of housing. Others have noted that self-help appears to be most likely where the economy is weakest, an observation which is consistent with the predicted incidence of self-help provisioning in Canada. However this thesis demonstrates that self-help also contributes to uneven development by depriving the residential construction industry of profits (from production as well as extra profits) and also by contributing to the ability of the population to survive at lower money wage levels and concomitantly reducing incentives for local industry to improve productivity. In this fashion self-help housing provision slows the accumulation process of both the residential construction industry and industry in general, thereby contributing to uneven development. The impact of housing policy on self-help provisioning is also examined. Self-help is more sensitive to policy initiatives such as changes in the costs of inputs or interest rates, and thus is more responsive to policy initiatives. At the same time, self-help generates more employment than does industry production. Thus, given the size of the sector, its higher incidence in areas with the greatest economic problems, and, that self-help provisioning is more affordable and the housing produced is of equal quality and suitability, then there is considerable potential for social and fiscal gains through policies directed towards the self-help housing sector.
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