A lottery for limited affordable housing, part two

A story about a lottery for 95 affordable housing units in San Francisco discusses the technique of using a lottery to award limited goods and how the lottery happens:

Lotteries that allocate scarce resources are not set up to distinguish the neediest from the merely needy. Rather, they reward random chance, which is a distinctly different notion of what’s “fair.”…

For years, San Francisco conducted public lotteries in a bingo drum. But the raffle tickets were always getting stuck in the drum’s crevices. The city also tried a big box. People couldn’t see what was happening inside, however, and tickets got stuck under the lid.

This exercise — rolling the drum, shaking the box, inspecting for trapped tickets and repeating — lasted hours on a building the size of Natalie Gubb Commons. Ms. Torres would bus around town, picking up applications, dropping off applications. Lines would wrap around some developers’ offices on deadline day….

Last year, San Francisco moved the whole process online. Renters can now more easily apply, which means that more do, and the odds have grown longer. But the system is more humane. The parts of the process where it has been most awkwardly apparent that people in need are competing are now less visible. The city still holds public lotteries, but they are primarily pep talks.

Three things jumped out at me about the lottery process and how it is presented:

  1. On one hand, a lottery can seem fair in this situation. How else would would limited public goods be fairly split up? We know that in regular life, having more resources and better connections tends to lead to more opportunities. For people with fewer resources and fewer connections to powerful people, isn’t a lottery fair?
  2. On the other hand, having to go through a lottery for something as basic as an affordable place to live seems crazy. The documentary Waiting for “Superman” used the lottery for a good school very effectively in its plot. By starting and end with the image of honest American families simply trying to get a good education for their kids through a lottery, it all looks absurd. The lottery itself is an excellent argument for why more affordable housing is needed.
  3. The actual mechanics of lottery are intriguing. A public drawing has a lot of potential for drama, both with images of excitement and disappointment. (Again, Waiting for “Superman” played this up.) But, actually having a fair system of drawing names is more difficult than it looks. And how can the applicants be reassured that it is an effective process? The shift to online makes some sense and yet I could imagine the process now looks even less transparent. How do we know the online system isn’t rigged? Is it truly random? What if the algorithm is biased?

I know waiting lists are commonly used for housing spots – and this has the advantage that Americans often like that people should at least have to put effort into getting on the list – but a lottery has both strengths and weaknesses.

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