The Babies of Mortgage Market Deregulation

Secular stagnation? The effect of aging on economic growth in the age of automation

Isaac Hacamo

The Review of Financial Studies, 2021, vol. 34, issue 2, 907-948

Abstract: This paper documents that mortgage market deregulation helps mitigate the risk of population aging by affecting a foundational family-level decision: the choice to have children. Using a U.S. federal regulator ruling, I show that young households fully exposed to mortgage market deregulation increase their probability of purchasing a home and having a child by 6 percentage points. Supplemental tests reject alternative hypotheses based on income or housing wealth growth and, instead, suggest that access to space is the relevant economic mechanism. Collectively, the evidence indicates that increased access to mortgage credit affects the total number of children in the economy.

JEL-codes: D1 G01 G28 J13 R21 R31 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (4)

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