How Electoral Realignment Changes Partisan Incentives to Provide Social Housing

Rising rents have revived interest in social housing across Europe, but new construction has stalled. We argue this is because a growing divergence between social housing residents and social democratic voters has reduced the party’s electoral incentive to build it. Using a regression discontinuity design and a panel of all local elections and housing permits in Denmark (1981–2021), we show that municipalities built more social housing when the Social Democrats won an extra council seat -- but this effect disappeared in the mid-1990s. Registry, survey, and electoral data reveal that over this period, social democratic voters became more affluent and educated, while social housing residents grew more economically marginalized. In line with this, support for the Social Democrats has declined in precincts with a high share of social housing, and they are no longer electorally rewarded for building it. Our findings highlight how electoral realignment shapes welfare state policies.