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Urbanization, agglomeration economies, and access to mortgage credit

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  • Gabriel, Stuart A.
  • Rosenthal, Stuart S.

Abstract

We examine the effect of urban agglomeration on access to mortgage credit using HMDA data from 1994 to 2008. Previous studies suggest that agglomeration should increase access to specialized workers and information, both of which should enhance liquidity in mortgage lending. Findings indicate that agglomeration economies increase mortgage origination rates and loan amounts in the 1990s, and especially so in higher risk locations. However, agglomeration effects dissipated over the study period. While we do not identify the microfoundations of these patterns, the decline in the influence of agglomeration coincides with the dramatic expansion of secondary mortgage markets and development of information technology, both of which should have reduced regional disparities in access to credit.

Suggested Citation

  • Gabriel, Stuart A. & Rosenthal, Stuart S., 2013. "Urbanization, agglomeration economies, and access to mortgage credit," Regional Science and Urban Economics, Elsevier, vol. 43(1), pages 42-50.
  • Handle: RePEc:eee:regeco:v:43:y:2013:i:1:p:42-50
    DOI: 10.1016/j.regsciurbeco.2012.11.006
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    Cited by:

    1. Mohamed El Hedi Arouri & Adel Ben Youssef & Cuong Nguyen-Viet & Agnès Soucat, 2014. "Effects of urbanization on economic growth and human capital formation in Africa," Working Papers halshs-01068271, HAL.
    2. Mariacristina Rossi & Eva Sierminska, 2015. "Housing Decisions, Family Types and Gender. A look across LIS countries," LIS Working papers 654, LIS Cross-National Data Center in Luxembourg.
    3. Mariacristina Rossi & Eva Sierminska, 2015. "Housing Decisions, Family Types and Gender: A Look across LIS Countries," SOEPpapers on Multidisciplinary Panel Data Research 815, DIW Berlin, The German Socio-Economic Panel (SOEP).

    More about this item

    Keywords

    Urbanization; Agglomeration economies; Mortgage credit;

    JEL classification:

    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • G2 - Financial Economics - - Financial Institutions and Services

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