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House prices and job losses

Pinter, Gabor (2015) House prices and job losses. CFM discussion paper series (CFM-DP2015-07). Centre For Macroeconomics, London, UK.

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Abstract

What explains the strong comovement between house prices and job losses over the UK business cycle? To study this question, I build a general equilibrium model with collateral constraints, endogenous job separation and housing shocks, and confront it with macroeconomic data via Bayesian methods. The results suggest that shocks to house prices (i) explain about 10-20% of output fluctuations and about 20-30% of fluctuations in unemployment and job separation rates via the collateral channel, and (ii) were a major cause in triggering the 1990 and 2008 recessions in the UK.

Item Type: Monograph (Discussion Paper)
Official URL: http://www.centreformacroeconomics.ac.uk/Home.aspx
Additional Information: © 2015 The Authors
Divisions: Centre for Macroeconomics
Subjects: H Social Sciences > HB Economic Theory
Sets: Research centres and groups > Centre for Macroeconomics
Date Deposited: 14 Dec 2017 12:01
Last Modified: 04 Jul 2019 23:26
URI: http://eprints.lse.ac.uk/id/eprint/86318

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