IDEAS home Printed from https://ideas.repec.org/a/spr/epolit/v36y2019i3d10.1007_s40888-017-0073-3.html
   My bibliography  Save this article

Homeownership and entrepreneurship: a search-and-matching model and a panel analysis in Italy

Author

Listed:
  • Gaetano Lisi

    (University of Cassino and Southern Lazio)

Abstract

Housing market rigidities or inefficiencies can damage labour market outcomes and increase unemployment. Also, a related research stream claims that higher homeownership rates are associated with fewer new businesses. Using a search-and-matching model, this theoretical paper investigates the inexplicably neglected relation between homeownership and entrepreneurship by distinguishing two channels through which homeownership affects the creation of enterprises and jobs. The first channel looks at the job search intensity of homeowners, while the second considers the link between the benefit of being a homeowner and the revenues of a new enterprise that is run by the homeowner. The main result of this paper is that the intrinsic preference for homeownership plays a key role in the establishment of new businesses, while in general homeownership does not encourage the development of existing enterprises. Indeed, a panel analysis in Italy confirms the main finding of the search-and-matching model, namely outright homeownership encourages the creation of new small businesses.

Suggested Citation

  • Gaetano Lisi, 2019. "Homeownership and entrepreneurship: a search-and-matching model and a panel analysis in Italy," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 36(3), pages 673-694, October.
    • Handle: RePEc:spr:epolit:v:36:y:2019:i:3:d:10.1007_s40888-017-0073-3
    DOI: 10.1007/s40888-017-0073-3
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s40888-017-0073-3
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s40888-017-0073-3?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. David G. Blanchflower & Andrew J. Oswald, 2013. "Does High Home-Ownership Impair the Labor Market?," NBER Working Papers 19079, National Bureau of Economic Research, Inc.
    2. Jakob Roland Munch & Michael Rosholm & Michael Svarer, 2006. "Are Homeowners Really More Unemployed?," Economic Journal, Royal Economic Society, vol. 116(514), pages 991-1013, October.
    3. Laamanen, Jani-Petri, 2017. "Home-ownership and the Labour Market: Evidence from Rental Housing Market Deregulation," Labour Economics, Elsevier, vol. 48(C), pages 157-167.
    4. Rupert, Peter & Wasmer, Etienne, 2012. "Housing and the labor market: Time to move and aggregate unemployment," Journal of Monetary Economics, Elsevier, vol. 59(1), pages 24-36.
    5. Yuval Kantor & Jan Möhlmann & Peter Nijkamp & Jan Rouwendal, 2015. "Homeownership, mortgages, and unemployment," Letters in Spatial and Resource Sciences, Springer, vol. 8(3), pages 253-265, November.
    6. Marianna Filandri & Manuela Olagnero, 2014. "Housing Inequality and Social Class in Europe," Housing Studies, Taylor & Francis Journals, vol. 29(7), pages 977-993, October.
    7. Fonseca, Raquel & Lopez-Garcia, Paloma & Pissarides, Christopher A., 2001. "Entrepreneurship, start-up costs and employment," European Economic Review, Elsevier, vol. 45(4-6), pages 692-705, May.
    8. Lauren R. Heller & E. Frank Stephenson, 2015. "Economic freedom, homeownership, and state labor market conditions," Journal of Entrepreneurship and Public Policy, Emerald Group Publishing Limited, vol. 4(2), pages 142-151, August.
    9. Christopher A. Pissarides, 2000. "Equilibrium Unemployment Theory, 2nd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262161877, December.
    10. Linneman, Peter & Voith, Richard, 1991. "Housing price functions and ownership capitalization rates," Journal of Urban Economics, Elsevier, vol. 30(1), pages 100-111, July.
    11. Munch, Jakob Roland & Rosholm, Michael & Svarer, Michael, 2008. "Home ownership, job duration, and wages," Journal of Urban Economics, Elsevier, vol. 63(1), pages 130-145, January.
    12. Jean-Michel Sahut & Marta Peris-Ortiz, 2014. "Small business, innovation, and entrepreneurship," Small Business Economics, Springer, vol. 42(4), pages 663-668, April.
    13. Stijn Baert & Freddy Heylen & Daan Isebaert, 2014. "Does Homeownership Lead to Longer Unemployment Spells? The Role of Mortgage Payments," De Economist, Springer, vol. 162(3), pages 263-286, September.
    14. Jan Rouwendal & Peter Nijkamp, 2010. "Homeownership and Labour-Market Behaviour: Interpreting the Evidence," Environment and Planning A, , vol. 42(2), pages 419-433, February.
    15. Oswald Andrew J., 1996. "A Conjecture on the Explanation for High Unemployment in the Industrialized Nations : Part I," The Warwick Economics Research Paper Series (TWERPS) 475, University of Warwick, Department of Economics.
    16. Philippe Bracke & Christian Hilber & Olmo Silva, 2014. "Homeownership and Entrepreneurship: The Role of Mortgage Debt and Commitment," CESifo Working Paper Series 5048, CESifo.
    17. Chiuri, Maria Concetta & Jappelli, Tullio, 2003. "Financial market imperfections and home ownership: A comparative study," European Economic Review, Elsevier, vol. 47(5), pages 857-875, October.
    18. Dohmen, Thomas J., 2005. "Housing, mobility and unemployment," Regional Science and Urban Economics, Elsevier, vol. 35(3), pages 305-325, May.
    19. Heston, Alan & Nakamura, Alice O., 2009. "Questions about the equivalence of market rents and user costs for owner occupied housing," Journal of Housing Economics, Elsevier, vol. 18(3), pages 273-279, September.
    20. Eli Beracha & Alexandre Skiba & Ken H Johnson, 2017. "Housing Ownership Decision Making in the Framework of Household Portfolio Choice," Journal of Real Estate Research, American Real Estate Society, vol. 39(2), pages 263-288.
    21. Martin Konecný & Dominik Stroukal, 2015. "Does housing market impair employment in The Czech Republic?," International Journal of Housing Markets and Analysis, Emerald Group Publishing Limited, vol. 8(3), pages 318-334, August.
    22. Coulson, N. Edward & Grieco, Paul L.E., 2013. "Mobility and mortgages: Evidence from the PSID," Regional Science and Urban Economics, Elsevier, vol. 43(1), pages 1-7.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gaetano Lisi, 2017. "Homeownership and entrepreneurship," Working Papers. Serie AD 2017-01, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    2. Gaetano Lisi, 2016. "Mortgage Market, Housing Tenure Choice and Unemployment," The Journal of Real Estate Finance and Economics, Springer, vol. 53(4), pages 472-493, November.
    3. Vives Coscojuela, Cecilia, 2018. "Housing Tenure, Geographical Mobility and the Labour Market: the Role of the Employment Exit Rate," IKERLANAK 30207, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
    4. Gaetano Lisi, 2018. "Unemployment, vacancies and housing tenure," Letters in Spatial and Resource Sciences, Springer, vol. 11(3), pages 333-341, October.
    5. William Cochrane & Jacques Poot, 2020. "Did the post-1986 decline in the homeownership rate benefit the New Zealand labour market? A spatial-econometric exploration," Asia-Pacific Journal of Regional Science, Springer, vol. 4(1), pages 261-284, February.
    6. Broulíková, Hana M. & Huber, Peter & Montag, Josef & Sunega, Petr, 2020. "Homeownership, mobility, and unemployment: Evidence from housing privatization," Journal of Housing Economics, Elsevier, vol. 50(C).
    7. Vives Coscojuela, Cecilia, 2015. "Geographical mobility and the labour market," IKERLANAK 15485, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
    8. Yang, Xi, 2019. "The effects of home ownership on post-unemployment wages," Regional Science and Urban Economics, Elsevier, vol. 74(C), pages 1-17.
    9. Julie Beugnot & Olivier Charlot & Guy Lacroix, 2019. "Does promoting homeownership always damage labour market performances?," Journal of Economics, Springer, vol. 127(2), pages 161-183, July.
    10. Andrea Morescalchi, 2016. "The Puzzle Of Job Search And Housing Tenure: A Reconciliation Of Theory And Empirical Evidence," Journal of Regional Science, Wiley Blackwell, vol. 56(2), pages 288-312, March.
    11. Rodríguez Hernández, José E. & Barrios García, Javier A., 2012. "¿Incide la forma de tenencia de la vivienda habitual sobre la situación de empleo en España?/Does the Housing Tenure Choice Affect the Employment Situation in Spain?," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 30, pages 751(22)-751, Agosto.
    12. Ch.-M. CHEVALIER & R. LARDEUX, 2017. "Homeownership and labor market outcomes: disentangling externality and composition effects," Documents de Travail de l'Insee - INSEE Working Papers g2017-09, Institut National de la Statistique et des Etudes Economiques.
    13. Beugnot, Julie & Lacroix, Guy & Charlot, Olivier, 2014. "Homeownership and Labour Market Outcomes: Micro versus Macro Performances," IZA Discussion Papers 8599, Institute of Labor Economics (IZA).
    14. Daan Isebaert & Freddy Heylen & Carine Smolders, 2015. "Houses and/or Jobs: Ownership and the Labour Market in Belgian Districts," Regional Studies, Taylor & Francis Journals, vol. 49(8), pages 1387-1406, August.
    15. Caliendo, Marco & Gielen, Anne C. & Mahlstedt, Robert, 2015. "Home-ownership, unemployed’s job search behavior and post-unemployment outcomes," Economics Letters, Elsevier, vol. 137(C), pages 218-221.
    16. Gaetano Lisi, 2018. "NIMBY effect, mortgage payments and firm size: the different impact of homeownership on new businesses," Economics Bulletin, AccessEcon, vol. 38(2), pages 908-915.
    17. Timo Tohmo & Jutta Viinikainen, 2023. "Home-ownership and unemployment: revisiting the Oswald hypothesis from a regional heterogeneity perspective," Economics and Business Letters, Oviedo University Press, vol. 12(4), pages 342-355.
    18. Stijn Baert & Freddy Heylen & Daan Isebaert, 2014. "Does Homeownership Lead to Longer Unemployment Spells? The Role of Mortgage Payments," De Economist, Springer, vol. 162(3), pages 263-286, September.
    19. David G. Blanchflower & Andrew J. Oswald, 2013. "Does High Home-Ownership Impair the Labor Market?," NBER Working Papers 19079, National Bureau of Economic Research, Inc.
    20. Yuval Kantor & Jan Möhlmann & Peter Nijkamp & Jan Rouwendal, 2015. "Homeownership, mortgages, and unemployment," Letters in Spatial and Resource Sciences, Springer, vol. 8(3), pages 253-265, November.

    More about this item

    Keywords

    Entrepreneurship; Search intensity; Intrinsic preference for homeownership; Outright homeownership; Homeownership with mortgage payments; Job creation; New firms; Small businesses;
    All these keywords.

    JEL classification:

    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:epolit:v:36:y:2019:i:3:d:10.1007_s40888-017-0073-3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.