Land Prices and Unemployment

Zheng Liu, Jianjun Miao and Tao Zha

No 2013-22, Working Paper Series from Federal Reserve Bank of San Francisco

Abstract: We integrate the housing market and the labor market in a dynamic general equilibrium model with credit and search frictions. The model is confronted with the U.S. macroeconomic time series. Our estimated model can account for two prominent facts observed in the data. First, the land price and the unemployment rate tend to move in opposite directions over the business cycle. Second, a shock that moves the land price is capable of generating large volatility in unemployment. Our estimation indicates that a 10 percent drop in the land price leads to a 0.34 percentage point increase of the unemployment rate (relative to its steady state).

Keywords: Housing; Labor market (search for similar items in EconPapers)
Pages: 42 pages
Date: 2013
New Economics Papers: this item is included in nep-dge and nep-ure
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Citations: View citations in EconPapers (26)

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Related works:
Journal Article: Land prices and unemployment (2016)
Working Paper: Land Prices and Unemployment (2015)
Working Paper: Land prices and unemployment (2013)
Working Paper: Land Prices and Unemployment (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedfwp:2013-22

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DOI: 10.24148/wp2013-22

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