Since 1970, mixed-income (inclusionary) housing projects have proliferated in the United States. In a community of this sort, only some of the dwelling units, perhaps as few as 10 to 25 percent, are targeted for delivery of housing assistance. Eligible households that successively occupy these particular units pay below-market rents, while the occupants of the other units do not. This Article situates this innovation within the broader history of U.S. housing policy and evaluates its merits. I contend that the mixed-income project approach, while superior to the traditional public housing model, is in almost all contexts distinctly inferior to the provision of portable housing vouchers to needy tenants. Although prior commentators also have touted the voucher approach, I enrich their analyses by addressing more fully the social consequences of various housing policies that might be used to economically integrate neighborhoods and buildings. It has traditionally been thought that enhancing socioeconomic diversity within a neighborhood has unalloyed social benefits. Many recent social-scientific studies present a more complex picture and weaken the case for government support of mixed-income projects.

In the first half of the twentieth century, the United States, like most other developed nations, began to subsidize rents in housing projects entirely set aside for working-class (or even less prosperous) households. By the 1980s, a broad consensus had emerged that the construction of these projects, traditionally referred to as “public housing,” had been a policy blunder in many settings. Since that time, two primary alternative approaches have been competing for legislative blessing. The first perpetuates the tradition of tying government aid to specific buildings, but reduces the percentage of aided units in a project from 100 percent to a lower figure, perhaps as little as 10 to 25 percent. Proponents of this “mixed-income,” or “inclusionary,” approach hope that it will mitigate the social pathologies that too often arise when children grow up amid the concentrated poverty prevalent in traditional public housing. The second alternative approach calls for the provision of portable vouchers to targeted households to better enable them to rent dwellings from private landlords. The voucher approach, the alternative typically advocated by housing economists, was ascendant in the United States in the mid-1990s. Since then, however, more and more housing advocates and policymakers have endorsed the mixed-income approach. As a result, mixed-income projects have sprouted across the country most notably in metropolitan areas such as Boston, Chicago, and San Francisco—and already house hundreds of thousands of households.