Homeownership and Labour Market Outcomes: Micro versus Macro Performances
Julie Beugnot (),
Guy Lacroix () and
No 8599, IZA Discussion Papers from Institute for the Study of Labor (IZA)
In this paper we investigate Oswald's hypothesis according to which higher homeownership rates increase aggregate unemployment rates. To this end, we develop a matching model à la Pissarides (2000) in which homeowners are assumed to be less mobile than tenants. Based on numerical simulations, we analyze both macroeconomic and microeconomic labour market outcomes following an (exogenous) increase in homeownership rates. We show that (1) Oswald's hypothesis does not always hold as it depends crucially on the importance of mobility costs; (2) while higher homeownership may harm macroeconomic labour market performances, individual performances always improve following an increase in homeownership rates.
Keywords: stochastic job matching; Oswald's hypothesis; homeownership; unemployment; mobility (search for similar items in EconPapers)
JEL-codes: J41 J61 J64 E24 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab, nep-mac and nep-ure
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