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Can the Mortensen-Pissarides Model Match the Housing Market Facts ?

Author

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  • Gaetano Lisi

    (University of Cassino - Creativity and Motivations (CreaM) Economic Center)

Abstract

This paper examines whether the baseline Mortensen-Pissarides matching model can account for the housing market facts, namely, the existence of price dispersion, the positive correlation between housing price and trading volume, and between housing price and time-on-the-market. Our main finding is that the model can account for these three basic facts of the housing market, thus showing that the Mortensen-Pissarides framework can be seen as the benchmark macroeconomic model not only for the labour market but for any market with frictions.

Suggested Citation

  • Gaetano Lisi, 2012. "Can the Mortensen-Pissarides Model Match the Housing Market Facts ?," Working Papers hal-00676072, HAL.
    • Handle: RePEc:hal:wpaper:hal-00676072
    Note: View the original document on HAL open archive server: https://hal.science/hal-00676072v2
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    References listed on IDEAS

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    1. Jeffrey Fisher & Dean Gatzlaff & David Geltner & Donald Haurin, 2003. "Controlling for the Impact of Variable Liquidity in Commercial Real Estate Price Indices," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 31(2), pages 269-303, June.
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    Keywords

    housing price dispersion; time-on-the-market; trading volume; search and matching process.; search and matching process;
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