Sunday, Jan. 3, 2021 12:15 PM - 2:15 PM (EST)
- Chair: Ingrid Ellen, New York University
The Political Economy of Public Housing Upgrading Programs
AbstractThe paper examines the differences in housing externalities across regions with different political affiliations. Using a merged dataset containing data on public housing upgrading, resale public housing transactions, electoral boundary and election results from 2010 to 2016 and a differences-in-discontinuity approach, we find evidence that the public housing programs are expedited in the ruling-party-held wards in periods leading up to the general elections, relative to contesting wards. We also find that the unbalanced provision of upgrading programs lead to higher housing externalities for blocks in the ruling-party-held ward than those for the otherwise similar blocks in the contesting wards. This paper provides new evidence on the expectation channel through which the housing externalities may be affected.
The Role of Informal Housing in Lowering China’s Urbanization Costs
AbstractOver the past 30 years, China has experienced unprecedented economic growth spurred by large-scale rural-urban migration, industrialization, and strong global demand for its cheaply produced goods. This paper argues that an abundant supply of informal housing helped accommodate huge migrant inflows, and contain labor costs. By constructing a unique proxy of city-level informal housing supply elasticity, we examine the linkages between urban housing markets and labor markets (migration flows and wages), with a focus on the low-skilled migrants who are most likely to live in informal housing. We find greater migration inflows in cities with more elastic housing supplies, in both informal and formal sectors. We show that informal housing supply elasticity matters more for low-skilled migrants (those with a high school education or less), and that formal housing supply conditions matter more for high-skilled migrants (those who have a college degree or more education). Cities with greater elastic housing supplies have lower wage levels and faster economic growth. The findings provide a better understanding of the important role the informal housing sector has played in facilitating the low-cost urbanization and industrialization of China.
Estimating the Vulnerability of Households to Rent Increases
AbstractThe question investigated in this paper is how vulnerable are US households today to the risk of rent increases. The short answer is that US households are, on average, more vulnerable to the risk of rent increases in 2018 than they were throughout the 1970s, 1980s, 1990s, and 2000s (and in heavily regulated markets even more vulnerable than they were in the 1940s and 1950s). To measure vulnerability requires a normative framework. We follow the approach developed by Sinai and Souleles (2005). We find that the rent premium that would leave households indifferent between the discounted cost of renting and its expected value is greater today, on average, than it was over the past fifty years (and in heavily regulated markets greater than it was over the past eighty years). There is therefore a clear public policy implication from this research.
Federal Reserve Bank of Atlanta
Federal Reserve Bank of Cleveland
- R0 - General