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on Urban and Real Estate Economics |
| By: | Andrew Coleman; John Landon-Lane (Reserve Bank of New Zealand) |
| Abstract: | This paper uses a structural vector autoregression model to analyse the relationship between migration flows, housing construction and house prices in New Zealand. It shows that a net immigration flow equal to one percent of the population is associated with an approximately 10 percent increase in house prices. This size of this relationship, which has existed since the 1960s, is an order of magnitude larger than would be expected from the average change in the population and house prices in the long term. One explanation is that migration flows occur at times when locals are changing their demand for housing because of revised expectations about future income growth. A second explanation is that migrant flows have a destabilising effect on agents expectations about the fundamental value of houses. While the paper cannot satisfactorily distinguish between these two options, the results suggest that monetary policy can still be used to dampen the house price changes that occur at times when migration flows are unusually large. |
| JEL: | E50 J61 R21 R23 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:nzb:nzbdps:2007/12&r=ure |
| By: | Aliprantis, Dionissi |
| Abstract: | This paper estimates the average treatment effect (ATE) of delaying children's enrollment in kindergarten by six months using the variation in birth dates that is exogenous in the ECLS-K data set. Estimates of the Math and Reading test score ATE start in the fall of kindergarten at 0.28 and 0.13 standard deviations and decline to 0.05 and 0.10 standard deviations by the spring of fifth grade. Unlike estimating the Local Average Treatment Effect (LATE) as done in the recent literature, estimating the ATE allows us to examine the effect of delaying enrollment by demographic characteristics. These estimates indicate that delayed enrollment could help explain the racial test score gap, and provide support for the hypothesis that the production of test scores is a cumulative process. |
| JEL: | J13 J24 I28 I21 |
| Date: | 2007–10–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:5196&r=ure |
| By: | Sumit Agarwal; John C. Driscoll; David Laibson |
| Abstract: | We derive the first closed-form optimal mortgage refinancing rule. The expression is derived by using the Lambert-W function to solve a tractable class of mortgage refinancing problems. We calibrate our solution and show that our quantitative results closely match those reported by researchers who use numerical methods. |
| JEL: | G11 G21 |
| Date: | 2007–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13487&r=ure |
| By: | Alessandro Petretto (Università degli Studi di Firenze, Dipartimento di Scienze Economiche) |
| Abstract: | In this note we reconstruct the process by a which the decisions of a regulated local public utility, in terms of productive efficiency and quality of the service provided, impact on prices of final consumption goods, supplied in a oligopolistic market operating in the same geographic area. We obtain some formula for these effects which can be quantified by estimating firms’ conditional input demand function of the public service and firms’ inverse demand function for the public good, non-rival, component of this. |
| Keywords: | regulation, x-efficiency, oligopoly |
| JEL: | L51 D11 D21 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:frz:wpaper:wp2007_06&r=ure |
| By: | Fuerst, Franz |
| Abstract: | The main objective of this paper is to elucidate the capability of time-series regression models to capture and forecast movements in occupancy patterns, rental rates and construction activity. The model presented is a three-stage simultaneous equation model. The first stage incorporates the office space market in terms of occupied space and absorption of new space. The second stage captures the adjustment of office rents to changing market conditions and the third stage specifies the supply response to market signals in terms of construction of new office space. The standard simultaneous model is subsequently modified to account for the specific characteristics using the New York market as a case study. The results demonstrate that the market reacts efficiently and predictably to changes in market conditions. The significance of the estimated parameters underscores the general validity and robustness of the simultaneous equation approach in modeling real estate markets. The modifications of the standard model, notably the inclusion of sublet space in the rent equation, contributed considerably to improving the explanatory power of the model. Finally, we test whether a non-linear function performs better than the original linear approach and find mixed evidence based on the limited empirical dataset of this study. |
| Keywords: | forecasting; real estate; office markets; dynamic models; simultaneous equation approach; multivariate regression models; |
| JEL: | R33 C53 C3 |
| Date: | 2006–06–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:5262&r=ure |
| By: | Brülhart, Marius; Jametti, Mario |
| Abstract: | We study the impact of tax competition on equilibrium taxes and welfare, focusing on the jurisdictional fragmentation of federations. In a representative-agent model of fiscal federalism, fragmentation among jurisdictions with benevolent tax-setting authorities unambiguously reduces welfare. If, however, tax-setting authorities pursue revenue maximization, fragmentation, by pushing down equilibrium tax rates, may under certain conditions increase citizen welfare. We exploit the highly decentralized and heterogeneous Swiss fiscal system as a laboratory for the estimation of these effects. While for purely direct-democratic jurisdictions (which we associate with benevolent tax setting) we find that tax rates increase in fragmentation, fragmentation has a moderating effect on the tax rates of jurisdictions with some degree of delegated government. Our results thereby support the view that tax competition can be second-best welfare enhancing by constraining the scope for public-sector revenue maximization. |
| Keywords: | direct democracy; fiscal federalism; government preferences; optimal taxation; tax competition |
| JEL: | D7 H2 H7 |
| Date: | 2007–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6512&r=ure |
| By: | Shinichiro Iwata (Faculty of Economics, University of Toyama); Hisaki Yamaga (Graduate School of Systems and Information Engineering, University of Tsukuba) |
| Abstract: | This paper considers two land tenure modes. leasehold and freehold. and models hous- ing maintenance incentives under land tenure security in Japan. Compared with freeholders, leaseholders are equally likely to remain in the premises, but spend less on home mainte- nance, because leaseholders are not full residual claimants, even under land tenure security. The empirical results show that maintenance expenditures of leaseholders are about 30% lower than those of freeholders in the Japanese residential land market. Empirical evidence also indicates that leaseholders are equally likely to remain in their premises even when they undermaintain their dwellings. |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:tky:fseres:2007cf520&r=ure |
| By: | Daniel Da Mata; Carlos Wagner de A. Oliveira; Cedric Pin; Guilherme Resende |
| Abstract: | This article aims to verify the main determinants of migration for a specific category: the qualified labor force. By qualified labor force, we mean persons with high education attainment (one year of college studies or more). The paper presents, first, the ranking of cities with higher attraction of qualified migrant. A specific indicator of qualified migration is elaborated, coined as index of net qualified migration, constructed from the comparison between qualified in-migrants and qualified outmigrants. Águas de São Pedro (SP) is the place with the highest index value. As for the group of municipalities with population higher than 100,000 inhabitants, São Paulo (SP) is the city in Brazil that has the highest net qualified migration index. Besides, the empirical analysis carried out in the paper aim to verify the main cities? characteristics concerning the attraction of qualified migrants. Spatial econometrics models, employed to correct for potential errors in the empirical strategy, corroborated the results estimated via ordinary least squares (OLS) models. Labor market dynamics, less social inequality, less crime, proximity to the coast and less rigorous climate are important factors behind the qualified migrants? choices to locate in a city. |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:ipe:ipetds:1305&r=ure |
| By: | David M. Cutler; Edward L. Glaeser |
| Abstract: | Are individuals more likely to smoke when they are surrounded by smokers? In this paper, we examine the evidence for peer effects in smoking. We address the endogeneity of peers by looking at the impact of workplace smoking bans on spousal and peer group smoking. Using these bans as an instrument, we find that individuals whose spouses smoke are 40 percent more likely to smoke themselves. We also find evidence for the existence of a social multiplier in that the impact of smoking bans and individual income becomes stronger at higher levels of aggregation. This social multiplier could explain the large time series drop in smoking among some demographic groups. |
| JEL: | I1 J12 |
| Date: | 2007–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13477&r=ure |
| By: | Marcella Veronesi (Corresponding author, Università di Verona and University of Maryland; Dipartimento di Scienze economiche (Università di Verona) and Department of Agricultural and Resource Economics (University of Maryland)); Martina Menon (Università di Verona; Dipartimento di Scienze economiche (Università di Verona)); Federico Perali (Università di Verona; Dipartimento di Scienze economiche (Università di Verona)) |
| Abstract: | This study proposes a novel approach to estimating a travel cost model that accounts for intrahousehold resource allocation. We define it ‘Collective Travel Cost Method’ (CTCM). The technique is based on an analogy borrowed from the literature of collective household behavior and adapted to the recreational setting. Knowledge of the travel cost to the recreational site of each household member allows us to identify the sharing rule within the household and to estimate a collective Almost Ideal Demand System that takes into account the role of each member’s preferences for consumption choices and how resources are allocated within the household. We show how to identify and estimate welfare measures, such as the equivalent variation (EV), to infer the Willingness-To-Pay (WTP) to access a natural park of each household member. Moreover, the development and estimation of the CTCM allows: (1) to test whether the WTP estimated by the traditional unitary TCM is significantly different from the WTP estimated by the CTCM; (2) to test whether two spouses have equal or different WTP to access the recreational site, and (3) whether the individual WTP estimated by the CTCM is significantly different from the WTP derived by applying the Contingent Valuation Method (CVM) on the same sample of individuals. |
| Keywords: | collective model, compensating variation, equivalent variation, revealed preferences, travel cost method, Willingness-To-Pay. |
| JEL: | D13 Q26 Q51 |
| Date: | 2007–10 |
| URL: | http://d.repec.org/n?u=RePEc:ver:wpaper:42&r=ure |
| By: | Servaas van der Berg (Department of Economics, Stellenbosch University); Megan Louw (Department of Economics, Stellenbosch University) |
| Abstract: | In regional context, South African students benefit from above average levels of public and private education resources. However, their performance on international tests – including SACMEQII (Southern African Consortium for Monitoring Educational Quality, 2000) – is extremely weak. The first part of the paper positions South Africa within southern and eastern Africa on the basis of SACMEQII Grade 6 mathematics test scores. Hierarchical linear modelling techniques are then employed to model the relationship between socio-economic status (SES) and schooling in this highly unequal country. Three important drivers of inequity in test scores emerge: principal concern with monitoring student progress, teacher absenteeism and teacher quality. These interact with SES to give richer students a strong advantage. |
| Keywords: | education quality, inequality, South Africa, Southern Africa, Hierarchical Linear Modelling |
| JEL: | I21 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:sza:wpaper:wpapers47&r=ure |
| By: | Mari Rege, Kjetil Telle and Mark Votruba (Statistics Norway) |
| Abstract: | Using Norwegian register data we estimate how children’s school performance is affected by their parents’ exposure to plant closure. Fathers’ exposure leads to a substantial decline in children’s graduation-year grade point average, but only in municipalities with mediocre-performing job markets. The negative effect does not appear to be driven by a reduction in father’s income and employment, an increase in parental divorce, or the trauma of relocating. In contrast, mothers’ exposure leads to improved school performance. Our findings appear to be consistent with sociological “role theories,” with parents unable to fully shield their children from the stress caused by threats to the father’s traditional role as breadwinner, and mothers responding to job loss by allocating greater attention towards child rearing. |
| Keywords: | educational outcomes; downsizing; job loss; layoffs; plant closure |
| JEL: | I20 J63 J65 |
| Date: | 2007–10 |
| URL: | http://d.repec.org/n?u=RePEc:ssb:dispap:517&r=ure |
| By: | Huang, Zuhui; Zhang, Xiaobo; Zhu, Yunwei |
| Abstract: | "Wenzhou used to be one of the poorest regions in eastern China. With limited arable land, poor road access to major cities, and little support from the upper level governments, this region seemed to lack all the conditions necessary for economic growth. However, over the past several decades Wenzhou has developed the most dynamic private sector in China, and has accordingly achieved one of the fastest growth rates. In particular, the footwear industry in Wenzhou has grown from a negligible market share to the largest in China. Here, we report a survey of 140 Wenzhou-based footwear enterprises of various scales, and use this information to examine the driving forces behind the dramatic rural industrial growth seen in this region. Our results show that clustering deepens the division of labor in the production process and makes it possible for small entrepreneurial firms to enter the industry by focusing on a narrowly defined stage of production. Therefore, Wenzhou represents an example of how clustering plays a significant role in helping fledgling rural industries overcome the growth constraints of capital and technology in the incipient stage of industrialization." from Authors' Abstract |
| Keywords: | Cluster analysis, Industrialization, Finance, Economic development, Nonfarm economy, |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:00705&r=ure |