Devika Hazra

A report prepared for the California Research Bureau, November 2022

with E. Shiau

Takeaways

• Federal and state policies soften the effect of economic recessions.
• State policies engage in meaningful policy innovation and can fill gaps in federal policy and offer additional protections even in resource-constrained environments.
• Widespread protections and supports in 2020 that facilitated housing stability have been effective.
• Speed, scale, and policy targeting are important for effective and efficient responses to economic recessions.
• Ensure equitable support by automating implementation where possible and through public information.
• Ensure equitable access to and benefits from homeownership across income, race, and ethnicity.
• Policy innovation occurs in response to crises, which also can lead to the “normalization” of policies and their widespread use.

A report prepared for the Centre for California Studies at Sacramento State University, November 2022

with E. Shiau

Abstract: Income and wealth inequality have been a persistent and growing problem in the state of California over the last 40 years. This report focuses on the role of economic recessions—primarily the 2008 Great Recession and the 2020 COVID-19 Recession—on income and wealth inequality with particular attention to their impacts on housing access and affordability. By reviewing the literature, this report outlines the relationship between economic recessions and inequality, how the unique characteristics of economic recessions lead to disparate impacts, and the particular impact of economic recessions on housing access and affordability. Through a literature review, this report also provides a discussion and assessment of federal and state policies designed to address the impact of economic recessions. It concludes by presenting empirical findings from original research that demonstrate the unique impact of economic recessions on housing access and affordability in California and Los Angeles.