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on Urban and Real Estate Economics |
| By: | Daniel Melser |
| Abstract: | Residential real estate is a key component of household wealth. While we have some insight into the aggregate returns of this asset class---thanks to real estate price indexes---we have little understanding of the characteristics of investment in individual properties. This paper outlines and applies a methodology for estimating and examining the variation in risk and return for unique homes. We use large data sets of home prices and rents for Sydney, Australia, from 2002-14, to estimate flexible spline hedonic models which incorporate spatial and characteristics smoothing. Using these models we estimate total returns---the sum of capital gains and rental yield---for a large sample of properties for each time period. This enables use to consider the risk and return of investment in individual parcels of residential real estate and explore the benefits of diversification. As a reference point, we contrast housing with investment in equities. We find that there is dispersion in returns and their volatility---though significantly less than shares---and that this is tied to certain home characteristics. However, when we investigate the benefits of holding a diversified portfolio of homes over a single home we find they are small compared with the corresponding case for equities. |
| Keywords: | Hedonic regression; House Prices; market model; Residential Real Estate; smoothing spline |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_296&r=ure |
| By: | Regina FangYing Lin |
| Abstract: | There are many causes of imbalance regional development. This study explores the idea that new infrastructure investment could subsequently lead and increased private construction investment differently over time and space. It further explores another idea – that the effects of each of the two kinds of infrastructure investment (social and economic) on each of the two main kinds of construction output, housing and commercial construction, may be quite different. In addition, yet another idea is explored – that the effects of increases either in the residential or the commercial built stock of a region may be that it calls-forth (provides the need and demand for) more infrastructure investment in that region – that infrastructure demand may be a function of the number of households, and, more particularly, of the number of dwellings, and of the amount of transport demand generated by commercial activities. Therefore, the aim of this research is to provide different views on the nature of the relationships between infrastructure investment and imbalance regional development in GB. The results show that the causal relationships differ across regions, and the economic infrastructure investment (transportation) has a deeper influence on both private commercial and residential investment than the social infrastructure. This research tries to improve the understanding the linkage between infrastructure investment and private construction investments in terms of their relations with economic growth, private property prices, and private construction outputs. |
| Keywords: | Econometric analysis; Infrastructure Investment; Regional Development |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_261&r=ure |
| By: | J. Michael Collins; Erik Hembre; Carly Urban |
| Abstract: | This paper documents and examines the rise in mortgage usage among older Americans over the past 30 years. It uses data from a variety of sources including the Health and Retirement Study, Decennial Census, American Community Survey, Survey of Consumer Finances, and the American Housing Survey. We begin by documenting the large increase in mortgage usage among older Americans across age and income distributions. We then use regression analysis to test for causes of the mortgage increase and subgroup heterogeneity, in particular focusing on changing health, bequest motives, and tax policy incentives. |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:crr:crrwps:wp2018-3&r=ure |
| By: | Duranton, Gilles; Venables, Anthony J |
| Abstract: | Many development policies, such as placement of infrastructure or local economic development schemes, are "place-based." Such policies are generally intended to stimulate private sector investment and economic growth in the treated place, and as such they are difficult to appraise and evaluate. This paper sets out a framework for analyzing the effects of such policies and assessing their social value. It then reviews the literature on place-based policies in the contexts of transport improvements, economic corridors, special economic zones, lagging regions, and urban policies. |
| Keywords: | economic corridors; lagging regions; Place based policies; spatial; urban |
| JEL: | O10 O18 R10 R11 R13 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12889&r=ure |
| By: | Cai, Zhengyu |
| Abstract: | This paper investigates the causal effects of agglomeration on hours worked by the self-employed. The IV estimations instrument for urbanization and localization using the minimum distance from the work Public Use Microdata Area centroid to the United States’ coastlines and estimated industry share in 1930. The 2SLS results demonstrate that urbanization and localization decrease and increase hours worked of the self-employed, respectively. These results are mainly from outsourcing and competition, whereas sorting, simultaneity, and agglomeration wage effect are less likely to be influential. Additionally, only small business owners perceive the pressures of competition in localization economies. The young unincorporated self-employed are more likely to be affected by peer competitors, whereas the elder unincorporated perceive more pressures from large firms. |
| Keywords: | Self-employed,hours worked,urbanization,localization,competition,coastlines |
| JEL: | J10 J22 J31 R11 R12 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:199&r=ure |
| By: | Christie Smith; Christoph Thoenissen |
| Abstract: | Shocks to net migration matter for the business cycles of some countries. Using an estimated dynamic stochastic general equilibrium (DSGE) model of a small open economy and a structural vector autoregression, we find that migration shocks account for a considerable proportion of the variability of per capita GDP. Migration shocks matter for the capital investment and consumption components of per capita GDP, but they are not the most important driver. Migration shocks are also important for residential investment and real house prices, but other shocks play a larger role in driving housing market volatility. In the DSGE model, the level of human capital possessed by migrants relative to that of locals materially affects the business cycle impact of migration. The impact of migration shocks is larger when migrants have substantially different levels of human capital relative to locals. When the average migrant has higher levels of human capital than locals, as seems to be common in most OECD economies, a migration shock has an expansionary effect on per capita GDP and its components. |
| Keywords: | Migration, macroeconomics, business cycle fluctuations, Bayesian estimation, structural vector autoregression |
| JEL: | E44 E61 F42 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2018-20&r=ure |
| By: | Christina Felfe; Martin G. Kocher; Helmut Rainer; Judith Saurer; Thomas Siedler |
| Abstract: | Inequality of opportunity, particularly when overlaid with racial, ethnic, or cultural differences, increases the social distance between individuals, which is widely believed to limit the scope of cooperation. A central question, then, is how to bridge such divides. We study the effects of a major citizenship reform in Germany—the introduction of birthright citizenship on January 1, 2000—in terms of inter-group cooperation and social segregation between immigrant and native youth. We hypothesize that endowing immigrant children with citizenship rights levels the playing field between them and their native peers, with possible spill-overs into the domain of social interactions. Our unique setup connects a large-scale lab-in-the-field experiment based on the investment game with the citizenship reform by exploiting the quasi-random assignment of citizenship rights around its cut-off date. Immigrant youth born prior to the reform display high levels of cooperation toward other immigrants, but low levels of cooperation toward natives. The introduction of birthright citizenship caused male, but not female, immigrants to significantly increase their cooperativeness toward natives. This effect is accompanied by a near-closure of the educational achievement gap between young immigrant men and their native peers.. |
| JEL: | C93 D90 J15 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6991&r=ure |
| By: | Stefan Jestl (The Vienna Institute for International Economic Studies, wiiw); Roman Römisch (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | This report is an annex to wiiw Research Report 423, ‘Economic Challenges of Lagging Regions III Recent Investment Trends and Needs’. Based on spatial econometric methods, it provides estimates and simulations of the investment effects on economic development in the EU lagging regions. It also provides additional data related to the analysis in wiiw Research Report 423. |
| Keywords: | regional economic development, EU, lagging regions, regional policy, economic challenges, investment, foreign direct investment, structural funds |
| JEL: | C15 C31 C80 R11 Y10 |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:wii:rpaper:rr:426&r=ure |
| By: | Ngai, L. Rachel; Pissarides, Christopher; Wang, Jin |
| Abstract: | China's hukou system imposes two main barriers to population movements. Agricultural workers get land to cultivate but are unable to trade it in a frictionless market. Social transfers (education, health, etc.) are conditional on holding a local hukou. We show that the land policy leads to over-employment in agriculture and it is the more important barrier to industrialization. Effective land tenure guarantees and a perfect competitive rental market would correct this inefficiency. The local restrictions on social transfers favour rural enterprises over urban employment with a relatively smaller impact on industrialization. |
| Keywords: | Chinese immigration; Chinese land policy; imperfect rental market; mobility barriers; hukou registration; social transfers |
| JEL: | J61 O18 R23 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:87619&r=ure |
| By: | Pat McAllister; Peter Wyatt; Edward Shepherd |
| Abstract: | In England, for over three decades planning obligations have been the main mechanism by which non-market housing has been delivered. Since around 2005, at the local planning authority level, tests of the financial viability of development projects have become a central consideration in planning policy making and development management concerning the provision of non-market housing. In essence, ostensibly to ensure that development is deliverable, a financial viability test involves a quantitative calculation of whether policies regarding requirements for non-market housing compromise a "competitive" financial return to the land owner and the developer. In a period of high levels of innovation and/or volatility in the English planning and housing policy regimes, this has been a fundamental change in the planning system. The research investigates changes in the supply of non-market housing in London in terms of its level and composition. Drawing upon data obtained from the Greater London Authority’s Development Database, the research investigates the relationship between national policy adjustments relating to housing and planning obligations, the supply of affordable housing, and land value capture in London and how this has evolved in the last decade. |
| Keywords: | Affordable Housing; Development appraisal; financial viability; Housing Supply; Planning Policy |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_95&r=ure |
| By: | Luca Benati |
| Abstract: | I explore whether time-series methods exploiting the long-run equilibrium properties of the housing market might have detected the disequilibrium in U.S. house prices which pre-dated the Great Recession as it was building up. Based on real-time data, I show that a VAR in levels identified as in Uhlig (2003, 2004) would have detected the disequilibrium with high confidence by the Summer of 2004, with the estimated extent of overvaluation peaking at about 15 per cent immediately before the crisis. These results demonstrate that disequilibria in the prices of at least one asset class–housing–can indeed be robustly detected as they are building up. Conceptually in line with Cochrane’s (1994) analysis for consumption and GNP, and dividends and stock prices, a key factor in order to robustly identify the transitory component of real house prices is applying Uhlig-style identification to real rents, which are cointegrated with house prices, and are comparatively much closer to the common stochastic trend. Directly focusing on house prices themselves, on the other hand, produces less robust results. |
| Keywords: | Structural VARs; unit roots; cointegration; long-run restrictions;medium-run identification; Great Recession; housing bubbles. |
| Date: | 2017–05 |
| URL: | http://d.repec.org/n?u=RePEc:ube:dpvwib:dp1705&r=ure |
| By: | Elias Oikarinen; Steven Bourassa; Martin Hoesli; Janne Engblom |
| Abstract: | We undertake a systematic analysis of the relationship between house prices and personal income using data for the 50 largest U.S. Metropolitan Statistical Areas (MSAs). We apply state-of-the-art panel data analysis tools, define income in multiple ways, allow for regional heterogeneity, and control for spatial dependence and endogeneity. We find that the house price-income ratio is not stable in the long run for most cities. In contrast, panel regression models that allow for regional heterogeneity and control for cross-sectional dependence yield stationary equations for MSA house prices. Among other findings, we show that relying on panel unit root tests is problematic. We also show that it is important to allow for heterogeneity across locations and to cater for endogeneity and cross-sectional dependence when analyzing the relationship between house prices and income. |
| Keywords: | cross-sectional dependence; House Prices; Panel Data; personal income; regional heterogeneity |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_173&r=ure |
| By: | Creina Day |
| Abstract: | Real house prices r ise in Australia amid growing concern of an impending correction. This paper explains why the household formation rate has risen with strong population growth due to higher net immigration and average household size levelling due to population ageing. An intertemporal model is developed to analyse the effect of an increase in the household formation rate on the housing market. We find that real house prices rise over time if the rate of household formation outstrips the rate of housing supply. Under forward looking expectations, a rising household formation rate could explain rising real house prices relative to the present discounted value of future wages. The results explain why real house prices may exhibit an upward trend despite population ageing and how government planning could have an impact. |
| Keywords: | Australia, Households, House Prices |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:een:crwfrp:1803&r=ure |
| By: | Blankespoor, Brian; Emran, M. Shahe; Shilpi, Forhad; Xu, Lu |
| Abstract: | This paper uses a quasi-experimental study of a major bridge construction in Bangladesh to understand the effects of a large reduction in trade costs on the pattern of structural change and agricultural productivity. We develop a spatial general equilibrium model with a core and two hinterlands at the opposite sides separated by rivers and allow for productivity gains through agglomeration in both agriculture and manufacturing sectors. The model yields insights different from the standard core-periphery and trade models:(i) the newly connected hinterland may experience higher population density and agricultural productivity despite significant de-industrialization, (ii) even with increased specialization in agriculture, the share of agricultural employment may decline when inter-regional trade requires local services (e.g. processing and trading), and (iii) the strongest effects on employment structure are felt not necessarily in the areas next to the bridge but in the areas that move out of autarky as a result of the bridge. In empirical estimation, we use doubly robust estimators in a difference-in-difference design where the comparison hinterland comes from a region which was supposed to be connected to the core (capital city) by the proposed, but not yet constructed, Padma bridge due to idiosyncratic political factors. In the short run, we find significant labor reallocation from agriculture to services in the connected hinterland, but no perceptible effects on the employment share of manufacturing, population density, and night-lights. In the long run, the labor share of manufacturing declines in the treatment hinterland and increases in the core, consistent with the de-industrialization effect emphasized in core-periphery models. However, there are significant positive effects on population density, night light luminosity and agricultural yields in the treatment hinterland which contradict backwash effects of the bridge. The effects of the bridge on intersectoral labor allocation are spatially heterogeneous, with relatively weak effects in the areas close to the bridge. |
| Keywords: | Core-Periphery, Density, Deindustrialization, Agricultural Productivity, Bridge, Bigpush, Backwash, Agglomeration |
| JEL: | O12 O13 O14 O18 |
| Date: | 2018–04–13 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86199&r=ure |
| By: | Vinokurov, Evgeny; Lobyrev, Vitaly; Tikhomirov, Andrey; Tsukarev, Taras |
| Abstract: | This report, prepared with the participation of experts from the Institute of the Economy and Transport Development, presents the results of quantitative assessment of freight traffic growth prospects along the China–EAEU–EU axis. The report provides a description of general trends affecting development of freight transport subject to commodity structure and mode of transport. Special attention is paid to factors driving changes in freight traffic. The authors present their view of the impact that freight rates have on the metrics of freight traffic being rechannelled to EAEU transport infrastructure and the operation of certain factors, such as regularity (rhythmicity) and timeframes of cargo deliveries. The final part of the report offers an assessment of additional freight traffic which may be attracted to transport routes along the China–EAEU–EU axis, in the short and long term. |
| Keywords: | Transport corridors, Belt and Road Initiative, transport infrastructure, Silk Road, EAEU, China, EU |
| JEL: | F15 R41 R42 |
| Date: | 2018–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86184&r=ure |
| By: | Jonas Hahn; Jens Hirsch; Joseph-Alexander Zeitler; Sven Bienert |
| Abstract: | Comprehensive research has dealt with the question whether property markets show price premiums for buildings that feature ‘green’ characteristics such as low energy consumption or a building certification. We expand existing research by raising and answering the question if housing properties that were explicitly advertised to feature ? ‘green’ ceating technology based on renewable energies or ‘brown’ heating technology based on fossil energies or even obsolescent technology come with significant price differences in association with these technological differences. For this purpose, we perform large-sample geoadditive regression analyses on the basis of a private dataset, which originally contains more than 3 million raw observations from German residential properties of 2015. We indeed find significant impact on housing prices, which is specifically visible in the form of a ‘brown’ discount for properties that are powered by fossil-fueled energy systems. From our findings, we suggest that low-energy consumption levels may still lead to price discounts c.p. if it is caused by mainly building-related quality and system-related measures stay unperformed. |
| Keywords: | Energy Efficiency; Heating Technology; Housing Market; Housing Prices; Sustainability |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_291&r=ure |
| By: | Durán-Vanegas, Juan David |
| Abstract: | This paper analyses the determinants of banking mortgage loan interest rate margins in the Colombian mortgage credit market focusing on the effects of market concentration and using a panel-econometric approach for the period Jan-2003 to Dic-2014. Results imply that interest rate margins are mainly explained by the volatility of long-run interest market rates and negatively associated to the level of market concentration. These findings are consistent with a modified version of the efficient-structure hypothesis which suggests that differences in efficiency create unequal market shares and allow firms to set lower prices. Further evidence is presented by the existence of a long-term relationship between mortgage interest rates and market concentration during the sample period. |
| Keywords: | Interest rate marings; Market structure; Housing finance |
| JEL: | C23 G21 |
| Date: | 2016–06–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86376&r=ure |
| By: | Quatraro, Francesco; Scandura, Alessandra (University of Turin) |
| Abstract: | This work investigates the generation of green technologies (GTs) in Italian NUTS 3 regions across time, by focusing on the knowledge generation mechanisms underlying the creation of green patents. Firstly, we hypothesize that inventions in non-green technological domains positively influence the generation of GTs, because the latter occur as the outcome of a recombination process among a wide array of technological domains. Secondly, we hypothesise that the involvement of academic inventors in patenting activity bears positive effects on the generation of GTs, because they are able to manage the recombination across different technological domains. Thirdly, we explore the interaction effect between academic inventors’ involvement and non-green technologies to investigate whether the former are especially relevant in presence of higher or lower levels of the latter. We estimate zero-inflated negative binomial, spatial durbin and logistic regressions on a dataset of 103 Italian NUTS 3 regions for which we collected patent and regional data for the time span 1998-2009. The results suggest that both academic inventors and spillovers from polluting technologies bear positive direct effects on the generation of GTs; moreover, we find that academic inventors compensate for low levels of spillovers. |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:uto:labeco:201802&r=ure |
| By: | Cindy M. Vojtech (Federal Reserve Board); Benjamin S. Kay (Office of Financial Research); John C. Driscoll (Federal Reserve Board) |
| Abstract: | Bank loan underwriting standards are key determinants of credit availability. To better understand what happens when bank loan officers change standards, we match responses from the Federal Reserve’s Senior Loan Officer Opinion Survey (SLOOS) with mortgage application information from the Home Mortgage Disclosure Act (HMDA)over the period from 1990 to 2013. HMDA data contain both accepted and denied applications, allowing us to observe changes in denial rates when loan officers report changing standards. Reports of tightened standards are associated with an increase of about 1 percentage point in denial rates (conditioning on changes in macroeconomic conditions and borrower credit quality), implying a reduction in aggregate mortgage credit of about $690 million per quarter. Reports of easing standards, though less frequent over that period, are associated with a 1 percentage point decline in denial rates. Denial rate changes are larger for banks that hold most of their mortgages on portfolio (rather than securitizing them). Tighter standards are associated with about 16 percent fewer high interest rate loans (a proxy for riskier loans). Applications rise at banks that report strengthening demand for mortgage loans. Metropolitan statistical areas (MSAs) that have more exposure to SLOOS banks that have tightened standards have much lower delinquency rates two years following the tightening — suggesting that standards are an important determinant of the credit quality of bank loan portfolios. House prices also fall in MSAs that have exposure to SLOOS banks that report tightening. |
| Keywords: | underwriting standards, home mortgage disclosure act (hmda), senior loan officer opinion survey (sloos) |
| Date: | 2016–05–11 |
| URL: | http://d.repec.org/n?u=RePEc:ofr:wpaper:16-05&r=ure |
| By: | Martinez, Constanza; Cizek, Pavel (Tilburg University, Center For Economic Research); Leon Rincon, Carlos (Tilburg University, Center For Economic Research) |
| Abstract: | The secured borrowing based on sell/buy-backs agreements is studied, specifically considering both: quantity and price. The empirical evidence presented in this paper suggests that, after controlling for specific individual characteristics, group-specific effects (defined by belonging or not to a financial group) play a relevant role in this market. Using spatial panel data models, we find that the amount of liquidity obtained with sell/buy-backs depend on traditional determinants (institution’s size and financial leverage), but also, on the average size of the financial group to which the financial institution belongs. Similarly, the borrowing cost depends on the amount of liquidity, but the average profitability of the financial group is also significant. Our results are robust to different relationship structures specified for financial groups. |
| Keywords: | funding costs; short-term liquidity; spatial panel data models |
| JEL: | C33 G20 G32 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiucen:acb00047-4136-4a18-b5a4-a32166b67aaa&r=ure |
| By: | Creina Day |
| Abstract: | Real house prices rise in the United Kingdom amid growing concern of an impending correction. The rate of household formation has increased with strong population growth, due to elevated rates of natural increase and net migration, and lack of growth in average household size, due to a rise in single-person households with population ageing. This paper presents an overlapping generations model of housing, endogenous labour, savings and growth to analyse the effect of an increase in the household formation rate and speculative demand under rational expectations on house prices in a general equilibrium. We find that real house prices rise over time if the rate of household formation outstrips the rate of housing supply, but do not follow a speculative bubble path in the long run. The results explain why the upward trend in real house prices reflects market fundamentals and has continued despite population ageing as the number of working and retired households grows relative to the number of older people seeking to sell. |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2018-21&r=ure |
| By: | Carlos Garcia Gimenez |
| Abstract: | Since the last financial crisis, researchers have included investors' strategy as a primary source for the acceleration of the house pricing boom that led to the last US real estate bubble. The motivation behind investors' behavior ranges from high-expected returns to reaction to popular real estate reports syndicated by media outlets and contagion from similar investment strategies adopted within neighborhoods. This exponential increase in house prices enticed many participants (known as ‘flippers') to profit from multiple transactions in short periods of time while the bubble inflated. So far the literature has not reached consensus on the identification strategy adopted to study the flippers phenomenon. Number of transactions, holding period and profit margin are used individually or combined to define flippers and their impact on house prices. We review the different identification strategies and empirically test their implication using real estate transactions data in South East Florida between 1996 and 2016. We also extend the literature in three ways: we measure the impact of flippers on both prices and returns; we identify the term structure of flippers returns beyond the normally adopted two years holding period; finally, we introduce a correction for capital expenditures which is essential in the game flippers play. |
| Keywords: | Behavioral finance; Frequent trading; House Prices; Short term investment; Term structure of returns%2Fpremia |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_236&r=ure |
| By: | Magdalena Teska; Paloma Taltavull de La Paz |
| Abstract: | Since the fundaments for the housing market were established after 1989, a large-scale privatisation raised and the dwellings were transferred to private inhabitants for a fraction of its value, increasing homeownership in the tenure structure. The market is determined by the groups of: homeowners – 69,04%, tenants – 4,16%, households with housing provided free – 26,78%Therefore, the paper examines the relationship of income distribution, housing and poverty with an approach to tenure structure, as well as probability of falling into poverty for those households which face housing affordability problems. Also, the impact of housing and the tenure structure on poverty reduction is evaluated. The research is based on housing affordability definitions and estimated housing poverty indicators, and the data source comes from the European Union Statistics on Income and Living Conditions (EU-SILC) provided by Eurostat, which provides a harmonized information on poverty, inequality, standard of living and other social issues, at both a regional and a national level. The result determines that, though the homeownership rate is high, homeownership and mortgages are more accessible to high-income households (4th quintile) hampering access to housing market to low-income households (1st quintile) and households in poverty, whereas the poverty is higher among the tenants than among the outright owners. |
| Keywords: | Housing; Housing Affordability; Income distribution; Poverty |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_377&r=ure |
| By: | Elena Argentesi; Paolo Buccirossi; Roberto Cervone; Tomaso Duso; Alessia Marrazzo |
| Abstract: | Assortment decisions are key strategic instruments for firms responding to local market conditions. We assess this claim by studying the effect of a national merger between two large Dutch supermarket chains on prices and on the depth as well as composition of assortment. We adopt a difference-in-differences strategy that exploits local variation in the merger’s effects, controlling for selection on observables when defining our control group through a matching procedure. We show that the local change in competitive conditions due to the merger did not affect individual products’ prices but it led the merging parties to reposition their assortment and increase average category prices. While the low-variety and low-price target’s stores reduced the depth of their assortment when in direct competition with the acquirer’s stores, the latter increased their product variety. By analyzing the effect of the merger on category prices, we find that the target most likely dropped high priced products, while the acquirer added more of them. Thus, the merging firms reposition their product offerings in order to avoid cannibalization and lessen local competition. Further, we show that other dimensions of heterogeneity, such as market concentration, whether a divestiture was imposed by the Dutch competition authority, and the re-branding strategy of the target stores, are important for explaining the post-merger dynamics. A simple theoretical model of local-market variety competition explains most of our findings. |
| Keywords: | Variety, assortment, mergers, ex-post evaluation, retail sector, supermarkets, grocery |
| JEL: | L1 L41 L66 L81 D22 K21 C23 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1734&r=ure |
| By: | François Deltour (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - UN - Université de Nantes, SSG - Sciences sociales et de gestion - IMT Atlantique - IMT Atlantique Bretagne-Pays de la Loire); Sébastien Le Gall (LEGO - Laboratoire d'Economie et de Gestion de l'Ouest - UBS - Université de Bretagne Sud - UBO - Université de Brest - Institut Mines-Télécom [Paris] - UBL - Université Bretagne Loire - IMT Atlantique - IMT Atlantique Bretagne-Pays de la Loire, MARSOUIN - Môle Armoricain de Recherche sur la SOciété de l'information et des usages d'INternet - UR1 - Université de Rennes 1 - UBS - Université de Bretagne Sud - UBO - Université de Brest - Ecole Nationale de la Statistique et de Analyse de l'Information - Rennes - Institut Mines-Télécom [Paris] - UR2 - Université de Rennes 2 - UNIV-RENNES - Université de Rennes - UBL - Université Bretagne Loire - IMT Atlantique - IMT Atlantique Bretagne-Pays de la Loire); Virginie Lethiais (LEGO - Laboratoire d'Economie et de Gestion de l'Ouest - UBS - Université de Bretagne Sud - UBO - Université de Brest - Institut Mines-Télécom [Paris] - UBL - Université Bretagne Loire - IMT Atlantique - IMT Atlantique Bretagne-Pays de la Loire, MARSOUIN - Môle Armoricain de Recherche sur la SOciété de l'information et des usages d'INternet - UR1 - Université de Rennes 1 - UBS - Université de Bretagne Sud - UBO - Université de Brest - Ecole Nationale de la Statistique et de Analyse de l'Information - Rennes - Institut Mines-Télécom [Paris] - UR2 - Université de Rennes 2 - UNIV-RENNES - Université de Rennes - UBL - Université Bretagne Loire - IMT Atlantique - IMT Atlantique Bretagne-Pays de la Loire) |
| Abstract: | This article discusses the role played by location of small and medium-sized firms on their propensity to innovate. The research adopts a broad definition of innovation and sets the hypothesis that SMEs' propensity to innovate is not higher in large urban areas than in rural ones. Moreover, reducing SMEs' location to their head office tends to overestimate urban areas' innovativeness. Following the administration of an original regional survey, econometric tests are run on a representative sample of 1,253 SMEs in the French Brittany region, completed by location data proposed by the French National Institute of Statistics (Insee). The results confirm that firms located in the largest urban areas of the region are not more innovative that those located in the most isolated areas. They also partially validate the hypothesis that measuring the firms' location using the location of the head offices leads to overestimate the innovativeness of largest urban areas compared to less urbanized one. |
| Keywords: | Innovation,Localisation,Petites et moyennes entreprises |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-01758281&r=ure |
| By: | Jewell, Sarah; Kazakis, Pantelis |
| Abstract: | The aim of this study is to disentangle the role of international migration on the job satisfaction of academic researchers. Using a relatively novel database, MORE2, that tracks the migratory behaviour of European researchers, and correcting for potential sorting behaviour of individuals via a multinomial treatment model, we find that more migratory groups tend to demonstrate higher levels of satisfaction regarding pecuniary outcomes. They also present higher levels of satisfaction regarding career advancement and social status, both crucial components in the lives of PhD holders. Our results survive in a battery of robustness checks, corroborating our main findings. |
| Keywords: | subjective-well-being; high-skilled migration; job satisfaction; European researchers |
| JEL: | J28 J61 R23 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86149&r=ure |
| By: | Mark Paddrik (Office of Financial ResearchAuthor-Name: Sriram Rajan; Office of Financial Research); H. Peyton Young (Office of Financial Research) |
| Abstract: | This paper analyzes counterparty exposures in the credit default swaps market and examines the impact of severe credit shocks on the demand for variation margin, which are the payments that counterparties make to offset price changes. We employ the Federal Reserve's Comprehensive Capital Analysis and Review (CCAR) shocks and estimate their impact on the value of CDS contracts and the variation margin owed. Large and sudden demands for variation margin may exceed a firm's ability to pay, leading some firms to delay or forego payments. These shortfalls can become amplified through the network of exposures. Of particular importance in cleared markets is the potential impact on the central counterparty clearing house. Although a central node according to conventional measures of network centrality, the CCP contributes less to contagion than do several peripheral firms that are large net sellers of CDS protection. During a credit shock these firms can suffer large shortfalls that lead to further shortfalls for their counterparties, amplifying the initial shock. |
| Keywords: | Credit default swaps, stress testing, systemic risk, financial networks |
| Date: | 2016–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:ofr:wpaper:16-12&r=ure |
| By: | Crudu, F.;; Neri, L.;; Tiezzi, S.; |
| Abstract: | This paper estimates the influence of overweight family members on weight outcomes of Italian children aged 6 to 14 years. We use a new dataset matching the 2012 cross sections of the Italian Multipurpose Household Survey and the Household Budget Survey. Endogenous peer groups within the family are accounted for using a set of instrumental variables. We find evidence of a strong, positive effect of both overweight adults and peer children in the family on children weight outcomes. The impact of overweight peer children in the household is larger than the impact of adults. These findings can help identifying the main factors driving the rise in Italian children obesity in the past few decades. |
| Keywords: | children obesity; family ties; IV probit; heteroskedasticity; |
| JEL: | I12 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:yor:hectdg:18/09&r=ure |
| By: | José Carlos Orihuela (Departamento de Economía de la Pontificia Universidad Católica del Perú); Victor Gamarra Echenique (Departamento de Economía de la Pontificia Universidad Católica del Perú) |
| Abstract: | The economic impacts of resource-based development are distributed unevenly across national space, and not even mining regions experience economic development in the same way. We build on the methodology of Rehner et. al. (2014) to typify resource-based economic development in Peru in the period 2001- 2015 and compare it with the case of mineral-abundant Chile. What we find is a nuanced version of the same dependency-related resource curse phenomenon. With the commodity cycle: (i) export specialization is not the same in all places; (ii) regional growth volatility is much higher in Peru than in Chile; (iii) the Dutch disease does not clearly manifest itself; and therefore (iv) economic dependence within Peru is variegated. At the national level, gold-and-copper-dependent Peru is not as vulnerable as copper-dependent Chile to external shocks. At the subnational level, outside Lima in particular, dependence-related volatility can be very high for clusters of regions. The results of the quantitative analysis are attuned to a theoretical framework of variegated dependence, which, while acknowledging the centrality of the center-and-periphery supranational structure for economic development, attributes variation in resource curse phenomena to subnational differences across space and over time in economic- geography configurations and institutional regimes. JEL Classification-JEL: F43 , O11 , O18 , Q33 , Q34 , Q37 , R58 |
| Keywords: | Dependence, Regional Development, Dutch disease, Export Specialization, Institutions, Resource Curse |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:pcp:pucwps:wp00458&r=ure |
| By: | Adam Brown; Ben Gardiner; Roman Römisch (The Vienna Institute for International Economic Studies, wiiw); Jonathan Stenning |
| Abstract: | The report analyses the fiscal and macroeconomic environment in the lagging regions and the relevant Member States of the EU, as a sound and sustainable macroeconomic framework is a necessary, but by itself not a sufficient precondition for investment and growth in the regions. It starts with identifying relevant indicators to highlight the macroeconomic environment in the lagging regions, assessing the performance of the regions across these indicators, and establishing a framework which sets out the potential causes of these imbalances. This sets the scene for further analysis of the transmission mechanisms which cause the regional discrepancies in these Member States between the lagging and the non-lagging regions, as well as exploring the differences between the low growth and low income lagging regions. The report concludes with a summary of these findings and how they could be used as a basis for policy recommendations which might improve the economic performance of the lagging regions. |
| Keywords: | macroeconomic development, regional economic development, EU, lagging regions, regional policy, economic challenges |
| JEL: | E32 E60 H60 O11 O18 O40 R11 |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:wii:rpaper:rr:421&r=ure |
| By: | Anna Gerke (Audencia Recherche - Audencia Business School); Kathy Babiak; Geoff Dickson (AUT - Auckland University of Technology); Michel Desbordes (CIAMS - Complexité, Innovation, Activités Motrices et Sportives - UP11 - Université Paris-Sud - Paris 11 - UO - Université d'Orléans) |
| Abstract: | Interorganisational linkages are a widely studied topic in sport management. However, most researchers focus on public or non-profit organisations and analyse one focal organisation rather than a network of interrelated organisations. The purpose of this study was to address both of these shortcomings by investigating interorganisational linkages in sport clusters, a type of cross-sectoral network. The authors address three main questions: (a) what is the nature of interorganisational linkages in sport clusters; (b) how do linkages in sport clusters develop; and (c) what are the organisational motivations for creating or joining linkages in sport clusters? A multiple case study approach explores two sailing clusters in France and New Zealand. Results show that interorganisational relationships tend to be formalised, while interorganisational networks tend to be informal. A circular development process from formal relationships to formal networks via informal relationships and networks was detected. Reciprocity is the most prevalent motive for the development of all types of interorganisational linkages. This research contributes to sport management practice by showcasing the potential multitude and variety of |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-01666875&r=ure |
| By: | Martin Hoesli; Jean-Christophe Delfim |
| Abstract: | This research investigates macroeconomic risk factors pertaining to the various types of real estate exposure, i.e. direct, listed and non-listed investments. We apply panel model techniques which make it possible to take advantage of both the cross-sectional and time series dimensions of our data. Much emphasis is placed on comparing sensitivities to risk factors across the types of real estate exposure. This is important in order to assess whether indirect (listed and non-listed) exposures react in the same way as direct investments to the macroeconomy and how well such investments replicate direct real estate behavior. The empirical analyses are conducted using U.S. data from 1984Q1 to 2016Q2. Allocations both by sector and geography are taken into account. For indirect exposures, we also control for size and leverage. Our results indicate that the GDP, money supply, construction costs, expected inflation and expected economic activity positively impact returns, while long-term interest rates, the term and credit spreads, unemployment and unexpected inflation negatively impact returns. The various types of real estate exposure generally respond similarly to risk factors. |
| Keywords: | Listed Real Estate; Macroeconomy; Non-listed real estate; Real Estate Investments; Risk Factors |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_61&r=ure |
| By: | Abhijit CHAKRABORTY; KICHIKAWA Yuichi; IYETOMI Hiroshi; IINO Takashi; INOUE Hiroyasu; FUJIWARA Yoshi; AOYAMA Hideaki |
| Abstract: | The structure of Japanese production networks with one million firms and five million supplier-customer links is studied. It is found that they form a tightly-knit structure with a core giant strongly connected component (GSCC) surrounded by IN and OUT components constituting two half-shells for the GSCC, which we name the Walnut structure after its shape. The hierarchical structure of communities is studied by the Infomap method and most of the irreducible communities are found to be on the second level. Composition of some of the major communities, including overexpression of industrial and regional nature, as well as connections between the communities, is studied in detail. The findings obtained here cast doubt on the validity and accuracy of the conventional input-output analysis, which is expected to be useful if firms in the same sectors would be well connected with each other. |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:18026&r=ure |
| By: | Nathan Fiala (University of Connecticut); Patrick Premand (World Bank) |
| Abstract: | Corruption and mismanagement of public resources can affect the quality of government services and undermine growth. Can citizens in poor communities be empowered to demand better-quality public investments? We look at whether providing social accountability training and information on project performance can lead to improvements in local development projects. The program we study is unique in its size and integration in a national program. We find that offering communities a combination of training and information on project quality leads to significant improvements in household welfare. However, providing either social accountability training or project quality information by itself has no welfare effect. These results are concentrated in areas that are reported by local officials as more corrupt or mismanaged, suggesting local agents have significant information about where corruption and mismanagement is worse. We show evidence that the impacts come in part from community members increasing their monitoring of local projects, making more complaints to local and central officials and increasing cooperation. We also find modest improvements in people’s trust in the central government. The results suggest that government-led, large-scale social accountability programs can strengthen communities’ ability to address corruption and mismanagement as well as improve services. |
| Keywords: | Social accountability; community training; scorecards; corruption; service delivery |
| JEL: | D7 H4 O1 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2018-04&r=ure |
| By: | Daniel Fehrle |
| Abstract: | In this paper, I present a multi-sectoral DSGE-model with housing, real rigidities and variable capital utilization that generates aggregate and sectoral co-movements due to sector specic shocks. Furthermore, the model accounts for two puzzles: First, residential investment correlates positively with house prices, and second, GDP residential and business investment tend toward the empirically observed lead-lag pattern. I show that, except for relative prices, all co-movements and the lead-lag pattern of different investment types are endogenous in the calibrated model and independent of the properties of the shock. In a second step, I estimate the these properties with Bayesian techniques. As it turns out, shocks to sectors with similar elasticities in the nal good sectors playa role related to aggregated shocks. In contradiction to a standard assumption in the literature, shocks to the construction sector seem to be lower than others. |
| Keywords: | Housing market, sectoral and aggregate co-movements |
| JEL: | E13 E32 O41 R31 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:bav:wpaper:178_fehrle&r=ure |
| By: | James Culley; Taimur Kahn |
| Abstract: | Residential property in Prime Central London (PCL) is a market with potentially half a trillion GBP in assets. Whilst various measures of capital growth of the market are available, information on total returns are far harder to come by.Whilst changes in capital growth are widely discussed in media and print the PCL residential is a sizeable market that has come under less academic scrutiny than other property asset classes. With growing investor interest in segments such as the private rented sector there is an increasing appetite for analyses focused upon residential property in the UK.In this study we use Knight Frank propriety information on aspects of the PCL market to construct return indices. We then analyse the sensitivity of PCL returns to returns in other asset classes, including alternative UK real estate sectors. We focus upon modelling correlation shifts between PCL and other asset classes during times of market growth and decline. The indices and analyses conducted in this study will provide results that will benefit and better inform actors such as private and institutional investors in the market. |
| Keywords: | asset correlations; Real estate returns; Residential Real Estate; time-varying risks |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_220&r=ure |
| By: | Dirk Niepelt |
| Abstract: | We propose a theory of tax centralization in politico-economic equilibrium. Taxation has dynamic general equilibrium implications which are rationally internalized at the federal, but not at the regional level. The political support for taxation therefore differs across levels of government. Complementarities on the spending side decouple the equilibrium composition of spending and taxation and create a role for inter governmental grants. The model provides an explanation for the centralization of revenue, introduction of grants, and expansion of federal income taxation in the U.S. around the time of the New Deal. Quantitatively, it accounts for between 30% and 100% of the federal revenue share’s doubling in the 1930s, and for the long-term increase in federal grants. |
| Keywords: | Fiscal policy, Federalism, Politico-economic equilibrium, Markov equilibrium, Public goods, Grants, Political Economy |
| JEL: | D72 E62 H41 H77 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:ube:dpvwib:dp1803&r=ure |
| By: | Gonzalo Ruiz D. (Departamento de Economía de la Pontificia Universidad Católica del Perú) |
| Abstract: | The present paper refers to the influence of interest groups and stakeholders on government and concessionaire contractual behavior in long-term public contracts. In particular, we show how government political commitments with interest groups represent a ‘reputational investment’, which reduces the incentives to enforce the contract and increases the willingness to accept renegotiation proposals. This situation, particularly in the case of “high profile” or “politically sensitive” projects, when observed by the private concessionaire, can be exploited to capture additional quasi-rents from the exchange relationship. Using a simple model and a case study of the South Interoceanic Road Project in Peru, we show how interactions of the government with influential stakeholders, in the context of weak institutions, can create favorable conditions for private opportunistic behavior. JEL Classification-JEL: D72 , L14 , L33 , L51 |
| Keywords: | Concession, Opportunism, Stakeholder |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:pcp:pucwps:wp00456&r=ure |
| By: | Adam Brown; Ben Gardiner; Roman Römisch (The Vienna Institute for International Economic Studies, wiiw); Jonathan Stenning |
| Abstract: | This report is an annex to wiiw Research Report 421, ‘Economic Challenges of Lagging Regions I Fiscal and Macroeconomic Environment’. It provides eight detailed country case studies, analysing the fiscal and macroeconomic environment in Bulgaria, Greece, Hungary, Italy, Poland, Portugal, Romania and Spain and its effects on the development of the lagging regions in those countries. |
| Keywords: | macroeconomic development, regional economic development, EU, lagging regions, regional policy, economic challenges |
| JEL: | E32 E60 H60 O11 O18 O40 R11 |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:wii:rpaper:rr:425&r=ure |
| By: | Melitz, Jacques; Toubal, Farid |
| Abstract: | Somatic distance, or differences in physical appearance, proves to be extremely important in the gravity model of bilateral trade in conformity with results in other areas of economics and outside of it in the social sciences. This is also true quite independently of survey evidence about bilateral trust. These findings are obtained in a sample of the 15 members of the European Economic Association in 1996. Robustness tests also show that somatic distance has a more reliable influence on bilateral trade than the other cultural variables. The article finally discusses the interpretation and the breadth of application of these results. |
| Keywords: | Bilateral Trade; Cultural interactions; Language; Somatic distance; Trust |
| JEL: | F10 F40 Z10 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12895&r=ure |
| By: | Seira Suzuki (PhD. Student, Osaka School of International Public Policy, Osaka University) |
| Abstract: | This paper investigate the effect of out-of-school activity in elementary school days on one’s future income. In order to analyze specifically, the model includes extra-curricular activities in junior high school, years of schooling, marital status and occupation. They could be influenced by the activity and also have effects on income. The data used for the analysis is the Preference Parameters Study. Related variables are extract and their relationship is calculated by path analysis. The result is in case of female, cultural activities have significant effect on income via schooling. In case of male, educational and sports activities increase one’s future income. |
| Keywords: | Out-of-school activity, income, path analysis |
| JEL: | I24 Z10 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:osp:wpaper:18e008&r=ure |
| By: | Ruggero Fornoni; Ben Gardiner; Lydia Greunz; Nirina Rabemiafara; Roman Römisch (The Vienna Institute for International Economic Studies, wiiw); Jonathan Stenning; Terry Ward |
| Abstract: | This report presents the findings of three case studies of lagging regions in the EU to deepen the findings of wiiw Research Reports 421 to 423. The three (NUTS 2) case study regions are the Italian Campania, the Portuguese Norte and the Romanian Nord-Est region. While each of these regions faces specific challenges due to their economic, social and geographic characteristics, they are at the same time to some extent representative of other EU regions that share similar characteristics and/or challenges. Each case study covers the economic development in the respective region, highlighting the main strengths and weaknesses in the region’s performance. Furthermore, each case study identifies the major, region-specific, causes of the observed developments. By focusing on those causes, each analysis develops a region-specific storyline on the success and failures in the regions’ economic development. Finally, each case study derives conclusions based on the above analysis. These conclusions should be indicative of potential development opportunities for each region and the necessary policy measures to overcome existing challenges in order to exploit these opportunities. |
| Keywords: | regional economic development, EU, lagging regions, regional policy, economic challenges, case study |
| JEL: | R10 R11 R58 |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:wii:rpaper:rr:424&r=ure |
| By: | Rodríguez-Pose, Andrés |
| JEL: | J1 |
| Date: | 2018–04–10 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:87589&r=ure |
| By: | Simpson Zhang (Office of Financial Research); Mihaela van der Schaar (Oxford-Man Institute of Quantitative Finance, University of Oxford) |
| Abstract: | This paper studies the role of learning and reputation in economic networks, such as interbank lending and derivatives trading networks, in times of market distress or financial crisis. The model demonstrates the importance of maintaining firm anonymity and identifies network structures that offer increased resilience. |
| Keywords: | Network Dynamics, Network Design, Reputational Learning, Social Welfare |
| Date: | 2018–04–19 |
| URL: | http://d.repec.org/n?u=RePEc:ofr:wpaper:18-03&r=ure |
| By: | Stefan Leknes; Jørgen Modalsli (Statistics Norway) |
| Abstract: | This paper studies the impact of the construction of hydropower facilities on labor market outcomes in Norway at the turn of the twentieth century (1891-1920). The sudden breakthrough in hydropower technology provides a quasi-experimental setting, as not all municipalities had suitable natural endowments and the possible production sites where often located in remote areas. We find that hydropower municipalities experienced faster structural transformation and displayed higher occupational mobility. Unskilled workers and workers from low-status families did to a greater extent obtain skilled jobs in hydropower municipalities. We interpret this as evidence that this early twentieth-century technology was skill-biased, and that workers in the new skilled jobs were recruited from a broad segment of the population. However, areas affected by the new technology also experienced occupational polarization, with an increase in high- and low-skilled manual jobs at the expense of intermediate-skilled jobs. |
| Keywords: | industrial revolution; hydropower production; structural transformation; occupational mobility; intergenerational mobility |
| JEL: | J62 N7 N9 R1 R12 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:ssb:dispap:874&r=ure |
| By: | de Roure, Calebe; Pelizzon, Loriana; Thakor, Anjan V. |
| Abstract: | We develop a simple theoretical model to motivate testable hypotheses about how peer-to-peer (P2P) platforms compete with banks for loans. The model predicts that (i) P2P lending grows when some banks are faced with exogenously higher regulatory costs; (ii) P2P loans are riskier than bank loans; and (iii) the risk-adjusted interest rates on P2P loans are lower than those on bank loans. We confront these predictions with data on P2P lending and the consumer bank credit market in Germany and find empirical support. Overall, our analysis indicates the P2P lenders are bottom fishing when regulatory shocks create a competitive disadvantage for some banks. |
| Keywords: | P2P lending,bank lending,competition |
| JEL: | G21 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:safewp:206&r=ure |
| By: | Farhad Farnood; Colin A. Jones |
| Abstract: | The private rented sector provides housing to a large proportion of European households. Within Europe, however, the nature and experience of the PRS in different countries is diverse. Private landlords in the UK experienced a boom period between 1997 and 2007. Hundreds of thousands of new investors were drawn to the private rented sector (PRS) by the availablity of mortgage finance and the combination of rental returns and capital growth. This ‘golden decade’ was brought to an end by the global financial crisis. However, the same crisis greatly reduced the affordability of home ownership as lending criteria tightened. The result was that the PRS continued to grow as a proportion of all housing provision. Private landlords in Scotland have been affected by policy and legislation from both the UK government in Westminster and the Scottish government in Holyrood. From both directions there have been decisions made and policies implemented which have reduced the attractiveness of the PRS as an investment. The paper uses qualitative interview data to give voice to the perceptions and attitudes of a cohort of private landlords with current PRS investments in the city of Edinburgh, Scotland. |
| Keywords: | Housing Policy; landlords; private rented sector; Scotland |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_223&r=ure |
| By: | Giacomo Morri; Ugo Perini |
| Abstract: | The paper investigates European non-listed real estate funds’ performance between 2001 and 2014. The database uses information about 363 funds, collected from Inrev Database. The goal of this analysis is to consider how the fees charged by a fund, its leverage, size and duration impact on the performance of the fund itself.The findings suggest the existence of a negative relationship between the return of a fund and redemption fee, performance fee and management fee. On the other hand, marketing fee, leverage, size and duration have a slightly positive effect on the performance of a fund. In addition, when analysing funds separately based on their investment style, we find that leverage has a positive effect on the return of core investment vehicles, while it affects slightly negatively the performance of more leveraged value-added ones. This suggests that an excessive use of debt impacts negatively the performance of a non-listed real estate vehicle.Finally, we show how throughout the time period studied the effects of the different independent variables, included in the model, on the performance of a fund did not significantly change and they have not been affected by the spread of the GFC. |
| Keywords: | Closed-ended Real estate funds; Fees-Performance relation; Non-Listed Real Estate Funds; Performance Analysis; Real estate indirect investment |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_314&r=ure |
| By: | Heinrich, Timo; Shachat, Jason |
| Abstract: | This study experimentally evaluates the risk preferences of children and adolescents living in an urban Chinese environment. We use a simple binary choice task that tests risk aversion as well as prudence. This is the first test for prudence in children and adolescents. Our results reveal that subjects from grades 5 to 11 (10 to 17 years) make mostly risk averse and prudent choices. With respect to risk aversion behavior of 3rd graders (8 to 9 years) does not differ statistically from risk neutrality. We also find 3rd graders to make mostly prudent choices. We also find evidence for a transmission of preferences: risk aversion is significantly correlated between children and their parents. Also, prudence is significantly correlated between girls (but not boys) and their parents. |
| Keywords: | risk aversion; prudence; transmission of preferences; age effects; experimental economics; children |
| JEL: | C93 D81 J13 |
| Date: | 2018–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86456&r=ure |
| By: | Anabela Santos (Université Libre de Bruxelles, iCite); Michele Cincera (Université Libre de Bruxelles, iCite and ECARES); Paulo Neto (Universidade de Évora – Departamento de Economia, UMPP, CEFAGE-UÉ and CIEO-UALG); Maria Manuel Serrano (Universidade de Évora – Departamento de Sociologia, UMPP and SOCIUS-CSG/ISEG-UL) |
| Abstract: | The aim of the present paper is to assess the effect of competition on innovation (patent applications) and on productivity (Total Factor Productivity and Labour Productivity), using data from 654 Portuguese firms, according to 208 NACE 4-digits sectors, and over the period 2007 to 2015. For this purpose, two different methodological approaches were used, a Poisson regression model for the patent function and a log-log fixed effect model for the productivity function. The results reveal that, on average, competition has a negative, U-shaped form effect on innovation in the short term, and a positive effect in the medium-long term. Nevertheless, the model focusing only on manufacturing sectors shows some differences from the model considering all economic activities, namely a linear positive effect of competition on innovation. Concerning the effect of competition on productivity, a positive effect on Total Factor Productivity emerged from the analysis, while for labour productivity a negative one prevails. |
| Keywords: | Competition, Innovation, Productivity. |
| JEL: | L10 O31 D24 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:mde:wpaper:0102&r=ure |
| By: | Richard Arnott (Department of Economics, University of California Riverside); Lopez Juan Carlos (Department of Economics, University of Denver) |
| Keywords: | Land Use Patterns, Housing Supply and Markets |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:ucr:wpaper:201809&r=ure |
| By: | David H. Downs; Steffen Sebastian; René-Ojas Woltering |
| Abstract: | This paper examines the impact of the ratio of price-to-fundamental value on the stock market performance of real estate securities following seasoned equity offerings and senior debt issuances. Using a global sample of real estate securities, we distinguish between growth stocks, i.e. those with the highest stock prices relative to the private market value of their properties, and value stocks, which tend to trade at substantial discounts to their net asset value (NAV). Consistent with the notion that newly issued equity is ultimately priced similar to pre-SEO levels, we find that growth stocks perform significantly better than value stocks in the 36 months following the SOE. We also examine the long run performance following senior debt issuances and document a substantial outperformance (underperformance) for growth (value) real estate securities in the 36 months following the offering. Overall, our findings are consistent with the hypothesis that growth REITs can benefit from "public vs. private market arbitrage". |
| Keywords: | debt offerings; net asset value; public vs. private market arbitrage; seasoned equity offerings%2C; value vs. growth |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_329&r=ure |
| By: | Gualtieri, Giovanni; Nicolini, Marcella; Sabatini, Fabio; Zamparelli, Luca |
| Abstract: | Abstract The literature shows that when a society believes that wealth is determined by random “luck” rather than by merit, it demands more redistribution. Adverse shocks, like earthquakes, strengthen the belief that random “bad luck” can frustrate the outcomes achieved with merit. We theoretically illustrate that individuals react to such shocks by raising support for redistribution. We then present evidence of this behavior by exploiting a natural experiment provided by one of the strongest seismic events that occurred in Italy in the last three decades, the L’Aquila earthquake in 2009. We assemble a novel dataset by matching information on the ground acceleration registered throughout the National Strong Motion Network during the earthquake with survey data about individual opinions on redistribution collected a few months later. The empirical analysis illustrates that the intensity of the shakes is associated with subsequent stronger beliefs that, for a society to be fair, income inequalities should be levelled by redistribution. |
| Keywords: | fairness; redistribution; inequality; natural disasters; earthquakes |
| JEL: | D63 D69 H10 H53 Z1 |
| Date: | 2018–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86445&r=ure |