EconPapers    
Economics at your fingertips  
 

Market thickness and the impact of unemployment on housing market outcomes

Li Gan, Pengfei Wang and Qinghua Zhang

Journal of Monetary Economics, 2018, vol. 98, issue C, 27-49

Abstract: A search-and-matching model is developed to study how unemployment influences the housing market in the presence of the thick-market effect. A structural estimation of the model is conducted based on Texas city-level data that covers three years—1990, 2000 and 2010. Simulations help clarify how much the thick-market effect amplifies the impact of unemployment. A three-percentage-point increase in the unemployment rate lowers the price by 10.74% and reduces the transaction volume by 5.49%. Incorporating a feedback mechanism from housing prices to unemployment strengthens the amplification magnitude of the thick-market effect.

Keywords: Housing markets; Unemployment; Thick-market effect; Search-and-matching (search for similar items in EconPapers)
JEL-codes: E R (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0304393218301983
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:moneco:v:98:y:2018:i:c:p:27-49

Access Statistics for this article

Journal of Monetary Economics is currently edited by R. G. King and C. I. Plosser

More articles in Journal of Monetary Economics from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2018-12-08
Handle: RePEc:eee:moneco:v:98:y:2018:i:c:p:27-49