Danish Ordoliberalism

The Danish housing system is an interesting case. Non-profit renting was kept out of public ownership and had a decentralised system of rent-setting, whereby each block of apartments is run by its own housing association and with a high degree of tenant autonomous decision-making (Jensen, 1997 and 2006). This keeps rents at cost-levels, with the national umbrella organisation of Danish Housing Associations acting as pressure group.

Unlike its Swedish counterpart, New Moderates, the right-wing Danish Government has not posed as a “new” anything, instead choosing a head-on confrontation using “Right to Buy” legislation passed in 2001. But strong tenant autonomy combined with cost-based rent setting made the policy a fiasco. Nielsen (2010, p. 224) shows how a target of 5,000 tenure conversions after 7 years of this policy had by 2008 resulted in just 44 tenure conversions! At the same time, Nielsen suggests that constant pressure exerted by an entrenched conservative government, combined with the political exclusion of the national umbrella organisation of Danish Housing Associations from practical governance may lead to an undermining of morale.

Reference:

Nielsen, Birgitta Gomez (2010) “Is Breaking Up Still Hard to Do? Policy retrenchment and Housing Policy Change in a Path Dependent Context” Housing Theory and Society (Vol. 27 No.3, 241-257)

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