A Life-Cycle Analysis of Social Security with Housing
AbstractThis paper incorporates two features of housing in a life-cycle analysis of social security: housing as a durable good and housing market frictions. We find that both housing quantities and homeownership rates respond strongly to eliminating social security. Accordingly, the aggregate impacts of this policy reform are significantly larger in an economy with explicit housing choices than in a standard life-cycle economy. Our analysis shows that the key mechanism behind these results is the substitution effects of a change in interest rates and, thus, the price of housing services on the choice of non-durable consumption versus housing services. (Copyright: Elsevier)
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Bibliographic InfoArticle provided by Elsevier for the Society for Economic Dynamics in its journal Review of Economic Dynamics.
Volume (Year): 13 (2010)
Issue (Month): 3 (July)
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Other versions of this item:
- Chen, Kaiji, 2009. "A Life-Cycle Analysis of Social Security with Housing," MPRA Paper 15509, University Library of Munich, Germany.
- Kiji Chen, 2010. "Code files for "A Life Cycle Analysis of Social Security with Housing"," Computer Codes 08-199, Review of Economic Dynamics.
- E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
- E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
- H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
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