Matching models and housing markets: the role of the zero-profit condition
AbstractThe recent and growing literature which has extended the use of search and matching models even to the housing market does not use the free entry or zero-profit assumption as a key condition for solving the equilibrium of the model. This is because a straightforward adaptation of the basic matching model to the housing market seems impossible. However, this paper shows that the zero-profit condition can be easily reformulated to take the distinctive features of the housing market into account. Indeed, it helps to provide a theoretical explanation for well-known empirical regularities in the housing markets.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Economics and Econometrics Research Institute (EERI), Brussels in its series EERI Research Paper Series with number EERI_RP_2012_22.
Date of creation: 22 Nov 2012
Date of revision:
trust (in) and power (of) tax authorities; tax compliance; tax evasion macroeconomics variables.;
Other versions of this item:
- Gaetano Lisi, 2013. "Matching Models and Housing Markets: the Role of the Zero-Profit Condition," Economic Research Guardian, Weissberg Publishing, Weissberg Publishing, vol. 3(1), pages 54-60, June.
- Gaetano Lisi, 2013. "Matching models and housing markets: the role of the zero-profit condition," Working Papers, Department of Applied Economics II, Universidad de Valencia 1301, Department of Applied Economics II, Universidad de Valencia.
- A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
- A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
- E26 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Informal Economy; Underground Economy
- H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion
- K34 - Law and Economics - - Other Substantive Areas of Law - - - Tax Law
- K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-12-15 (All new papers)
- NEP-DGE-2012-12-15 (Dynamic General Equilibrium)
- NEP-IUE-2012-12-15 (Informal & Underground Economics)
- NEP-URE-2012-12-15 (Urban & Real Estate Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Brian Petereson, 2009. "Fooled by Search: Housing Prices, Turnover and Bubbles," Caepr Working Papers, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington 2009-004, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington.
- Robert Novy-Marx, 2009. "Hot and Cold Markets," Real Estate Economics, American Real Estate and Urban Economics Association, American Real Estate and Urban Economics Association, vol. 37(1), pages 1-22.
- Charles Ka Yui Leung & Jun Zhang, 2011. "¡§Fire Sales¡¨ in Housing Market: Is the House- Search Process Similar to a Theme Park Visit?," International Real Estate Review, Asian Real Estate Society, Asian Real Estate Society, vol. 14(3), pages 311-329.
- Christopher A. Pissarides, 2000. "Equilibrium Unemployment Theory, 2nd Edition," MIT Press Books, The MIT Press, The MIT Press, edition 1, volume 1, number 0262161877, December.
- Gaetano Lisi, 2013. "On the Functional Form of the Hedonic Price Function: A Matching-theoretic Model and Empirical Evidence," International Real Estate Review, Asian Real Estate Society, Asian Real Estate Society, vol. 16(2), pages 189-207.
- Gaetano Lisi, 2011.
"The Hedonic Price Function in a Matching Model of Housing Market,"
AccessEcon, vol. 31(3), pages 2347-2355.
- Lisi, Gaetano, 2011. "The Hedonic Price Function in a Matching Model of Housing Market," MPRA Paper 32697, University Library of Munich, Germany.
- Charles Leung & Youngman Leong & Siu Wong, 2006.
"Housing Price Dispersion: An Empirical Investigation,"
The Journal of Real Estate Finance and Economics, Springer,
Springer, vol. 32(3), pages 357-385, May.
- Charles Ka Yui Leung & Youngman Chun Fai Leong & Siu Kei Wong, 2005. "Housing Price Dispersion: an empirical investigation," Discussion Papers, Chinese University of Hong Kong, Department of Economics 00012, Chinese University of Hong Kong, Department of Economics.
- Charles Ka-Yui Leung & Youngman Chun Fai Leong & Siu Kei Wong, 2005. "Housing Price Dispersion: An Empirical Investigation," Departmental Working Papers, Chinese University of Hong Kong, Department of Economics _167, Chinese University of Hong Kong, Department of Economics.
- Wheaton, William C, 1990. "Vacancy, Search, and Prices in a Housing Market Matching Model," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 98(6), pages 1270-92, December.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julia van Hove).
If references are entirely missing, you can add them using this form.