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Unemployment in the Great Recession: Did the Housing Market Crisis Prevent the Unemployed from Moving to Take Jobs?

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  • Henry S. Farber

Abstract

The labor market in the Great Recession and its aftermath is characterized by great difficulty in escaping unemployment. I present two empirical analyses of a particular explanation for that difficulty, that the housing market crisis has prevented the unemployed from selling their homes and moving to take new jobs. First, I examine post-job-loss mobility rates by home ownership status using data from the Displaced Workers Survey. Second, I examine mobility rates for unemployed homeowners and renters from the month-to-month CPS match. Neither analysis provides any support for the idea that the housing market crisis has reduced mobility of the unemployed.

Suggested Citation

  • Henry S. Farber, 2012. "Unemployment in the Great Recession: Did the Housing Market Crisis Prevent the Unemployed from Moving to Take Jobs?," American Economic Review, American Economic Association, vol. 102(3), pages 520-525, May.
    • Handle: RePEc:aea:aecrev:v:102:y:2012:i:3:p:520-25
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    References listed on IDEAS

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    1. Modestino, Alicia Sasser & Dennett, Julia, 2013. "Are American homeowners locked into their houses? The impact of housing market conditions on state-to-state migration," Regional Science and Urban Economics, Elsevier, vol. 43(2), pages 322-337.
    2. Henry S. Farber, 2011. "Job Loss in the Great Recession: Historial Perspective from the Displaced Workers Survey, 1984-2010," Working Papers 1309, Princeton University, Department of Economics, Industrial Relations Section..
    3. Oswald, Andrew J., "undated". "A Conjecture on the Explanation for High Unemployment in the Industrialized Nations: Part I," Economic Research Papers 268744, University of Warwick - Department of Economics.
    4. Farber, Henry S, 2011. "Job Loss in the Great Recession: Historical Perspective from the Displaced Workers Survey, 1984-2010," IZA Discussion Papers 5696, Institute of Labor Economics (IZA).
    5. Daniel Aaronson & Jonathan Davis, 2011. "How much has house lock affected labor mobility and the unemployment rate?," Chicago Fed Letter, Federal Reserve Bank of Chicago, issue Sep.
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