On Roots of Housing Bubbles
AbstractThis paper is about instability of equilibrium real rents in a pure exchange economy. Our main result hinges upon a low degree of substitutability between housing services and other commodities together with a low share of owner-occupied houses. We argue that regions or economies with a low share of owner-occupied houses are more prone to housing bubbles that are driven by locally unstable rent dynamics.
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Bibliographic InfoPaper provided by TOBB University of Economics and Technology, Department of Economics in its series Working Papers with number 0801.
Date of creation: Jul 2008
Date of revision:
Other versions of this item:
- C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
- D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
- D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
- R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
- R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
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0901, TOBB University of Economics and Technology, Department of Economics.
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