The decision to move house and aggregate housing-market dynamics

Ngai, L. Rachel ORCID: 0009-0005-1605-856X and Sheedy, Kevin D. ORCID: 0000-0002-0247-6323 (2020) The decision to move house and aggregate housing-market dynamics. Journal of the European Economic Association, 18 (5). 2487 - 2531. ISSN 1542-4766

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Abstract

Using data on house sales and inventories, this paper shows that housing transactions are driven mainly by listings and less so by transaction speed, thus the decision to move house is key to understanding the housing market. The paper builds a model where moving house is essentially an investment in match quality, implying that moving depends on macroeconomic developments and housing-market conditions. The number of transactions has implications for welfare because each transaction reduces mismatch for homeowners. The quantitative importance of the decision to move house is shown in understanding the U.S. housing-market boom during 1995–2003.

Item Type:	Article
Official URL:	https://academic.oup.com/jeea
Additional Information:	© 2020 The Authors
Divisions:	Economics
Subjects:	H Social Sciences > HC Economic History and Conditions H Social Sciences > HF Commerce
JEL classification:	D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search; Learning; Information and Knowledge; Communication; Belief E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Employment, and Investment > E22 - Capital; Investment (including Inventories); Capacity R - Urban, Rural, and Regional Economics > R3 - Production Analysis and Firm Location > R31 - Housing Supply and Markets
Date Deposited:	28 May 2019 09:48
Last Modified:	14 Nov 2024 22:36
URI:	http://eprints.lse.ac.uk/id/eprint/100890

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