|
on Urban and Real Estate Economics |
| By: | Michaelides, Marios |
| Abstract: | Previous research on migration has focused more on the effect of wage differences between the destination and the origin on migration and less on how non-pecuniary attachments workers have to their current location may affect their migration decisions. In this paper, we examine how the presence of a strong social network and desirable location amenities in the current location may deter individual migration across U.S. metropolitan areas. Our empirical results show that, controlling for wage and housing cost differences between metropolitan areas, workers with strong attachments to their current location are significantly less likely to move. Interestingly, the effects of a strong social network and desirable location amenities on individual migration decisions are more important than the effect of wage or housing cost differentials between the destination and the origin. |
| Keywords: | migration; worker mobility; mobility costs; location amenities; wages; housing costs |
| JEL: | J6 R3 J3 J01 R2 |
| Date: | 2009–12–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20379&r=ure |
| By: | Pavlyuk, Dmitry |
| Abstract: | A relationship between public transport accessibility and residential land value is a point of interest of many recent researches. A hedonic price regression model, widely used in this research area, has one very important shortcoming – it calculates an "average" influence of factors on land value in the analysing area. Usually spatial effects present in data, and the influence of public transport accessibility can be distributed over the area non-uniformly. In this study we apply a comparatively new modification of the regression model – geographically weighted regression – to examine the relationship between public transport accessibility and residential land value (in a form of rent and sell prices) in Riga. The proposed method allows taking into account spatial effects present in the relationship. We use information about geographical locations of urban public transport stops and routes to calculate a level of transport accessibility. Together with the transport accessibility level and a common set of property-specific parameters (floor area, number of rooms, etc.) we consider additional hedonic properties of a flat location such as distances to supermarkets, higher schools and natural attractors like large parks, the river, and the seaside. |
| Keywords: | geographically weighted regression; hedonic price model; public transport accessibility |
| JEL: | L92 C21 C01 |
| Date: | 2009–08–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20921&r=ure |
| By: | Alexandros Vardoulakis; Dimitrios Tsomocos; Charles Goodhart |
| Abstract: | The purpose of this paper is to explore financial instability in this case due to a housing crisis and defaults on mortgages. The model incorporates heterogeneous banks and households. Mortgages are secured by collateral, which is equal to the amount of housing which agents purchase. Individual default is spread through the economy via the interbank market. Several comparative statics illustrate the directional effects of a variety of shocks in the economy. |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:fmg:fmgdps:dp649&r=ure |
| By: | David Stadelmann; Steve Billon |
| Abstract: | Fiscal packages usually capitalize into house prices. But if enough land for construction is available, housing developers can supply new houses and capitalization may disappear. We provide a theoretical model in which income taxes and public services capitalize at lower rates when housing supply elasticity increases. Using an empirical linear interaction model, we estimate the impact of available land for construction on capitalization rates with a panel of Swiss communities. Results indicate that fiscal variables do not capitalize differently in communities where housing supply is constrained by land availability. Thus, land availability is not sufficient for capitalization to disappear. |
| Keywords: | Capitalization; Land Scarcity; Taxes; Local public goods |
| JEL: | R21 R31 H40 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:cra:wpaper:2010-03&r=ure |
| By: | Klarl, Torben |
| Abstract: | The aim of this paper is to introduce a new model selection mechanism for cross sectional spatial models. This method is more flexible than the approach proposed by Florax et al. (2003) since it controls for spatial dependence as well as for spatial heterogeneity. In particular, Bayesian and Maximum-Likelihood (ML) estimation methods are employed for model selection. Furthermore, higher order spatial influence is considered. The proposed method is then used to identify knowledge spillovers from German NUTS-2 regional data. One key result of the study is that spatial heterogeneity matters. Thus, robust estimation can be achieved by controlling for both phenomena. -- |
| Keywords: | Spatial econometrics,Bayesian spatial econometrics,Spatial heterogeneity |
| JEL: | C11 C31 C52 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:10005&r=ure |
| By: | Bealey, Timothy; Meads, Neil; Surico, Paolo |
| Abstract: | This paper uses a unique data set on more than 600,000 mortgage contracts to estimate a credit supply function which allows for risk-heterogeneity. Non-linearity is modelled using quantile regressions. We propose an instrumental variable approach in which changes in the tax treatment of housing transactions are used as an instrument for loan demand. The results are suggestive of considerable risk heterogeneity with riskier borrowers penalised more for borrowing more. |
| Keywords: | individual mortgage data; credit supply; risk pricing; heterogeneous effects; instrumental variable. |
| JEL: | D10 E21 G21 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20905&r=ure |
| By: | Schindler, Felix |
| Abstract: | Extending the controversial findings from relevant literature on testing the efficient market hypothesis for the U.S. housing market, the results from the monthly and quarterly transaction-based Case-Shiller indices from 1987 to 2009 provide further empirical evidence on the rejection of the weak-form version of efficiency in the U.S. housing market. In addition to conducting parametric and non-parametric tests, we apply technical trading strategies to test whether or not the inefficiencies can be exploited by investors earning excess returns. The empirical findings suggest that investors might be able to obtain excess returns from both autocorrelation- and moving average-based trading strategies compared to a buy-and-hold strategy. -- |
| Keywords: | Housing market,weak-form market efficiency,random walk hypothesis,variance ratio tests,runs test,trading strategies |
| JEL: | G12 G14 G15 R31 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:10004&r=ure |
| By: | Steve Bradley; Jim Taylor; Giuseppe Migali |
| Abstract: | We evaluate the effect on test scores of a UK education reform which has increased funding of schools and encouraged their specialisation in particular subject areas, en- hancing pupil choice and competition between schools. Using several data sets we apply matching methods to confront issues of the choice of an appropriate control group and different forms of selection bias. We demonstrate a statistically significant causal effect of the specialist schools policy on test score outcomes and test score gain. The effect peaks after 4 years, at which point the additional funding ceases. A specialisation effect occurs yielding relatively large improvements in test scores in particular subjects. |
| Keywords: | School Quality, Subject Specialisation, Matching models |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:lan:wpaper:006416&r=ure |
| By: | Damien Vaquier |
| Abstract: | The sociological and economic impact of the shift to the new site of Chandivali, the availability and choice of employment being the key driver towards socio-economic urban integration is assessed. |
| Keywords: | sociological, economic, chandivali, Mumbai, employment, slums, urban, socio-economic, household survey, quantitative, public policies, labour market, infrastructure, ecological environment, family, city, metropolis, surat, gujarat, population, textile mills, Maharashtra, liberalization, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2428&r=ure |
| By: | Rabe B (Institute for Social and Economic Research); Taylor M (Institute for Social and Economic Research) |
| Abstract: | Most previous empirical studies of individual migration choice analyze the reasons associated with out-migration from an origin location. In contrast, we model the migration decision within the context of potential destinations, using British panel data over the period 1991-2003. Contrary to earlier micro studies we show that regional differences in expected individual wages, employment opportunities, and house prices are important determinants of migration, thus confirming results of aggregate analyses. Moreover, we find that it is important to control for unobserved individual heterogeneity. After doing so, the effects on migration choice of individual unemployment and being a council tenant disappear. |
| Date: | 2010–02–22 |
| URL: | http://d.repec.org/n?u=RePEc:ese:iserwp:2010-05&r=ure |
| By: | Marcella Nicolini (Fondazione Eni Enrico Mattei); Andrea Boitani (Catholic University); Carlo Scarpa (University of Brescia and Fondazione Eni Enrico Mattei) |
| Abstract: | This paper investigates how the ownership and the procedure for the selection of firms operating in the local public transport sector affect their productivity. In order to compare different institutional regimes, we carry out a comparative analysis of 72 companies operating in large European cities. This allows us to consider firms selected either through competitive tendering or negotiated procedures. The analysis of the data on 77 European firms over the period 1997-2006 indicates that firms operate under constant returns to scale. Retrieving the residuals we obtain a measure of total factor productivity, which we regress on firm and city characteristics. We find that when firms are totally or partially in public hands their productivity is lower. Moreover, firms selected through competitive tendering display higher total factor productivity. |
| Keywords: | Local Public Transport, Public Ownership, Translog Production Function |
| JEL: | C33 K23 L25 L33 L91 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.9&r=ure |
| By: | Mendicino, Caterina; Lambertini, Luisa; Punzi , Maria Teresa |
| Abstract: | This paper analyzes housing market boom-bust cycles driven by changes in households'expectations. We explore the role of expectations not only on productivity but on several other shocks that originate in the housing market, the credit market and the conduct of monetary policy. We find that, in the presence of nominal rigidities, expectations on both the conduct of monetary policy and future productivity can generate housing market boom-bust cycles in accordance with the empirical findings. Moreover, expectations of either a future reduction in the policy rate or a temporary increase in the central bank's inflation target that are not fulfilled generate a macroeconomic recession. Increased access to credit generates a boom-bust cycle in most variables only if it is expected to be reversed in the near future. |
| Keywords: | Credit Frictions; Boom-Bust Cycles; News Shocks; Housing Prices. |
| JEL: | E32 E52 E44 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20776&r=ure |
| By: | Beck, Thorsten (Tilburg University); Kibuuka, Katie (World Bank); Tiongson, Erwin R. (Asian Institute of Management) |
| Abstract: | Household credit, especially for mortgages, has doubled over the past years in the new European Union member countries, raising concerns about the economic and social consequences of household indebtedness in the event of a macroeconomic crisis. Using household survey data for 2005, 2006, and 2007 for both old and new European Union members, this paper assesses the determinants of access to mortgage finance. It also examines whether mortgage holders were more likely to suffer financial distress compared with non-mortgage holders in the period before the global financial crisis. The analysis does not find any systematic evidence that mortgage holders are financially more vulnerable than renters or outright owners; in fact, the incidence of financial vulnerability generally fell between 2005 and 2007, possibly reflecting the strong income growth experienced by these countries over this period. In addition, although tenure status is more difficult to explain in the new European Union member countries, the analysis finds that many of the same drivers of tenure status in the older member countries generally drive tenure status in the newer member countries as well. Finally, there is no evidence that access to mortgage credit is based on expected income in the old or in the new European Union member countries. |
| Keywords: | household credit, housing finance, financial vulnerability, EU accession |
| JEL: | D14 D91 G21 R21 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4758&r=ure |
| By: | Luca Andriani (Department of Economics, Mathematics & Statistics, Birkbeck); Dimitrios Karyampas (Department of Economics, Mathematics & Statistics, Birkbeck) |
| Abstract: | The paper investigates whether social capital can affect the standard living of the Italian households based on poverty and social exclusion. The analysis is developed at the regional level through cross-sections based in the year 2002 and in the year 2003. The indices of social capital that we use are the associational activity a la Putnam and a new proxy based on the regional density of industrial districts. By using the empirical model advanced by Grootaert (2001) we find that our results confirm the theory of social capital and poverty transition mechanism advanced by Narayan and Woolcock (2000). Moreover we find significant and negative correlation between social capital and the measures of social exclusion. All these results, drive the paper to the conclusion that social capital is positively correlated to higher level of living standard. |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:bbk:bbkefp:1005&r=ure |
| By: | Gete, Pedro |
| Abstract: | This paper makes a theoretical and an empirical contribution to the debate on what caused the "global imbalances". On the empirical side, I provide different types of evidence to support that housing demand shocks (shocks to the aggregate marginal rate of substitution between housing and tradables) help to explain the global imbalances. On the theory side, I show that shocks to the demand for housing generate trade deficits without need for the standard ingredients used by others to model housing (wealth effects or trade in capital goods). I model housing as a durable and nontradable good. Countries import tradable goods during periods when more domestic labor is devoted to produce nontradables to smooth consumption between tradables and nontradables. Housing booms are larger if the country can run a trade deficit because the deficit lowers the opportunity cost of building, which is the foregone consumption of tradable goods due to reallocation of labor to the construction sector. Concerning the empirical evidence, I first document that over the last decade there has been a strong cross-country correlation between housing variables and current account dynamics. Second, I show that using the cross-country dynamics of employment in construction as the explanatory variable, the model generates current account dynamics matching recent global imbalances. Finally, I use sign restrictions implied by the model to estimate a vector autoregression and identify the effects of housing demand shocks on the U.S. trade deficit. The results suggest that housing shocks matter for current account dynamics. |
| Keywords: | Housing; Current Account; Global Imbalances; Sign Restrictions; Two Country Models; Two Sector Models |
| JEL: | F4 E2 F3 E4 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20957&r=ure |
| By: | Neethi P |
| Abstract: | With the support of the labour geography framework, this study tries to analyse how the economic geography of capitalism is shaped by the spatial practices of labour. The model that is taken up is not upon a global scale but at a very local scale of organisation and show how organising locally can, in fact, be an effective strategy during confrontation with social actors organised at the global and other extra-local scales. The study raises the need for going against the grain by questioning global stereotypes with regard to expected economic responses to globalisation. For the study the case of apparel workers in two units in an export promoting industrial park in Kerala is taken. [WP 417] |
| Keywords: | industrial park, capitalism, organisation, economic responses, apparel workers, social actors, export, Globalisation, Kerala, Labour Geography, Local-Global, Tensions, Space-Place Conflicts, Kerala, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2431&r=ure |
| By: | Thomas Barrios; Rebecca Diamond; Guido W. Imbens; Michal Kolesar |
| Abstract: | It is standard practice in empirical work to allow for clustering in the error covariance matrix if the explanatory variables of interest vary at a more aggregate level than the units of observation. Often, however, the structure of the error covariance matrix is more complex, with correlations varying in magnitude within clusters, and not vanishing between clusters. Here we explore the implications of such correlations for the actual and estimated precision of least squares estimators. We show that with equal sized clusters, if the covariate of interest is randomly assigned at the cluster level, only accounting for non-zero covariances at the cluster level, and ignoring correlations between clusters, leads to valid standard errors and confidence intervals. However, in many cases this may not suffice. For example, state policies exhibit substantial spatial correlations. As a result, ignoring spatial correlations in outcomes beyond that accounted for by the clustering at the state level, may well bias standard errors. We illustrate our findings using the 5% public use census data. Based on these results we recommend researchers assess the extent of spatial correlations in explanatory variables beyond state level clustering, and if such correlations are present, take into account spatial correlations beyond the clustering correlations typically accounted for. |
| JEL: | C01 C1 C31 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15760&r=ure |
| By: | Vinokurov, Evgeny; Dzhadraliyev, Murat; Shcherbanin, Yuriy |
| Abstract: | The geographic and geo-economic location of EurAsEC countries gives them significant strategic potential for freight transit. EurAsEC has motorway and railway corridors running east-west and north-south, and a number of new corridors are being constructed. However, to handle such huge volumes of cargo, the region’s existing transport infrastructure must be modernised. Sea vs land: 2:1. Transportation of transit cargo by sea (transoceanic service) has some strong advantages, such as low delivery cost, established relationships with customers and high standards of service. This leads us to conclude that sea transit will prevail in the near future. Land transit routes offer only one competitive advantage – speed of delivery, which is two to three times faster compared with the sea routes linking East Asia with Eastern Europe. This advantage must be exploited. A considerable proportion of “time-sensitive” transit (some 16 million tonnes annually, according to the most conservative estimate) can be redirected to ITCs operated by EurAsEC. There are a number of physical and non-physical barriers to the realisation of the EurAsEC’s transit potential. Physical barriers include the poor state of motorways and railways and their related infrastructure, i.e. obsolete rolling-stock, which prevents any increase in transportation speeds and volumes; existing roads do not meet international standards; border crossing points and logistics centres have a low throughput capacity. Non-physical barriers include cumbersome permit systems, unreasonable delays in crossing borders, various charges and additional taxes imposed by regulatory and local authorities, scheduled and spot-check inspections of cargo weight, etc. The non-physical barriers are the most significant obstacles to the development of cargo transit in the region and cause serious delays in cargo delivery. Time lost does not only result in loss of money and customer trust, but also the loss of the main (in fact the only) competitive advantage land transit has over sea transit. Given their geographic position and national economic interests, Russia, Kazakhstan and their neighbours have a direct interest in the Eurasian integration process that extends beyond the boundaries of the post-Soviet space and involves the region’s most important countries. Projects implemented in certain economic sectors provide a reliable basis for regional economic integration. What begins in those key sectors eventually spreads to the institutional level. In this context, therefore, transportation must be among these priority sectors. |
| Keywords: | Eurasian Economic Community; transport infrastructure; transport corridors; economic integration; post-Soviet space |
| JEL: | F15 L91 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20908&r=ure |
| By: | Krishnan, P.; Krutikova, S. |
| Abstract: | We examine the impact of a programme designed to raise the psychosocial skills (self-esteem and self-efficacy) and aspirations of children in the slums of Bombay. We use a cross-cutting design with two comparison groups of peers for young adults who have attended the programme until leaving high school to analyse whether, compared to those from a similar environment and background, enrollment in the programme demonstrably raises psychosocial skills. We also use extensive data on parental background and psychosocial skills to construct difference-in-difference estimates that account for for family-level ob- servables and unobservables. This is a non-randomised evaluation: hence, we are cautiously optimistic in our finding of substantial impacts on both self-esteem and self-efficacy, as well as evidence of an impact on aspirations. Furthermore, in line with the literature, both self-esteem and self-efficacy are positively related to success in school-leaving examinations and initial labour market outcomes. |
| Date: | 2010–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1010&r=ure |
| By: | Alberto F. Alesina; Yann Algan; Pierre Cahuc; Paola Giuliano |
| Abstract: | Flexible labor markets require geographically mobile workers to be efficient. Otherwise, firms can take advantage of the immobility of workers and extract monopsony rents. In cultures with strong family ties, moving away from home is costly. Thus, individuals with strong family ties rationally choose regulated labor markets to avoid moving and limiting the monopsony power of firms, even though regulation generates lower employment and income. Empirically, we do find that individuals who inherit stronger family ties are less mobile, have lower wages, are less often employed and support more stringent labor market regulations. There are also positive cross-country correlations between the strength of family ties and labor market rigidities. Finally, we find positive correlations between labor market rigidities at the beginning of the twenty first century and family values prevailing before World War II, which suggests that labor market regulations have deep cultural roots. |
| JEL: | J2 K2 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15747&r=ure |