Cultural Superstitions and Residential Real Estate Prices: Transaction-level Evidence from the US Housing Market

Brad Humphreys, Adam Nowak and Yang Zhou
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Adam Nowak: West Virginia University, Department of Economics
Yang Zhou: West Virginia University, Department of Economics

No 16-27, Working Papers from Department of Economics, West Virginia University

Abstract: In Chinese culture, the number 8 is considered lucky and 4 is considered unlucky. We analyze the relationship between the presence of 8s and 4s in addresses and transaction prices paid by Chinese home buyers and sellers in a novel setting, Seattle, Washington, from 1990 to 2015. In the absence of explicit identifiers for Chinese individuals, we develop a probabilistic model for identifying ethnicity based on name alone. The results indicate Chinese buyers pay a 1-2% premium for addresses that include an 8 and 1% less for properties with a 4 in the address. These results are not related to unobserved property quality as there is no premium when Chinese sell properties with an 8 in the address. These results suggest that some Chinese home buyers in Seattle retain their Chinese cultural superstitions.

Keywords: Superstition; property value; supervised learning; hedonic price model (search for similar items in EconPapers)
JEL-codes: D03 R21 R30 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2016-12
New Economics Papers: this item is included in nep-cul and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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