On the association between housing deprivation and urban size: Evidence from South Asia

Housing is a basic human need; however, in recent decades slums have become the face of urbanization in developing economies. Urbanization drives economic growth, playing an important role in providing adequate housing and reducing poverty. In this paper, we investigate the association between housing deprivation and the urban size at a regional level for South Asian countries in the year 2015. We use two main sources of data. The first is the Demographic and Health Surveys (DHS), which provide microdata that allows us to build housing deprivation indexes based on the material characteristics of households and housing assets. The second source is satellite imagery, used to define urban cores and measure the urban size of each region. Then, we use a two-step procedure to identify the relationship between the urban size and housing deprivation. Our results indicate that age and higher levels of education (of the head of household) are negatively associated with our housing deprivation indexes in South Asian households. Furthermore, a greater number of children in South Asian households is related to higher levels of housing deprivation. In the second step, we show that there is a significant negative association between material housing deprivation and the urban size at a regional level for our full sample and for the majority of countries taken individually. An important exception is India, where an inverted-U-shaped relationship between deprivation and urban size is found. This result is robust even when an IV approach is used.