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Housing, debt and the economy: a tale of two countries

Author

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  • Muellbauer, John

Abstract

In housing affordability levels and volatility, there could hardly be a greater contrast than between the UK and Germany. Differences in history, institutions and policies are explored in this paper. Residential housing supply has been far more expansionary in Germany and mortgage credit more tightly regulated. A sensibly regulated rental market and stable German house prices have combined to leave the rental sector with over half of tenures. Policy failures in the UK have resulted in widening intergenerational inequality, increased social exclusion, adversely affected productivity and growth and raised the risk of financial instability. Policy lessons are drawn for the UK, which go far beyond the remit of the immediately responsible Ministry of Housing, Communities and Local Government.

Suggested Citation

  • Muellbauer, John, 2018. "Housing, debt and the economy: a tale of two countries," National Institute Economic Review, National Institute of Economic and Social Research, vol. 245, pages 20-33, August.
    • Handle: RePEc:cup:nierev:v:245:y:2018:i::p:r20-r33_12
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    Citations

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    Cited by:

    1. John Muellbauer, 2023. "Why we need a green land value tax and how to design it," Economics Series Working Papers 1010, University of Oxford, Department of Economics.
    2. repec:osf:osfxxx:8f67h_v1 is not listed on IDEAS
    3. Josh Ryan‐Collins, 2021. "Private Landed Property and Finance: A Checkered History," American Journal of Economics and Sociology, Wiley Blackwell, vol. 80(2), pages 465-502, March.
    4. Murray, Cameron & Ryan-Collins, Josh, 2020. "When homes earn more than jobs: the rentierization of the Australian housing market," OSF Preprints 8f67h, Center for Open Science.
    5. Paul Cheshire, 2019. "The Costs of Containment: Or the Need to Plan for Urban Growth," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 20(03), pages 10-14, October.
    6. zu Ermgassen, Sophus & Drewniok, Michal & Bull, Joseph & Walker, Christine Corlet & Mancini, Mattia & Ryan-Collins, Josh & Serrenho, André Cabrera, 2022. "A home for all within planetary boundaries: pathways for meeting England’s housing needs without transgressing national climate and biodiversity goals," OSF Preprints 5kxce, Center for Open Science.
    7. Josh Ryan-Collins, 2021. "Breaking the housing–finance cycle: Macroeconomic policy reforms for more affordable homes," Environment and Planning A, , vol. 53(3), pages 480-502, May.
    8. zu Ermgassen, Sophus O.S.E. & Drewniok, Michal P. & Bull, Joseph W. & Corlet Walker, Christine M. & Mancini, Mattia & Ryan-Collins, Josh & Cabrera Serrenho, André, 2022. "A home for all within planetary boundaries: Pathways for meeting England's housing needs without transgressing national climate and biodiversity goals," Ecological Economics, Elsevier, vol. 201(C).
    9. Cheshire, Paul & Carozzi, Felipe, 2019. "Housing Sprint: land report," LSE Research Online Documents on Economics 102339, London School of Economics and Political Science, LSE Library.
    10. Paul Cheshire & Christian A. L. Hilber, 2024. "Housing and planning," CEP Election Analysis Papers 061, Centre for Economic Performance, LSE.

    More about this item

    JEL classification:

    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • R38 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Government Policy
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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