IDEAS home Printed from
MyIDEAS: Login to save this paper or follow this series

Does High Home-Ownership Impair the Labor Market?

  • David G. Blanchflower


    (Peterson Institute for International Economics)

  • Andrew J. Oswald


    (University of Warwick)

The authors explore the hypothesis that high home-ownership damages the labor market. The results are relevant to, and may be worrying for, a range of policymakers and researchers. The authors find that rises in the home-ownership rate in a US state are a precursor to eventual sharp rises in unemployment in that state. The elasticity exceeds unity: A doubling of the rate of home-ownership in a US state is followed in the long-run by more than a doubling of the later unemployment rate. What mechanism might explain this? The authors show that rises in home-ownership lead to three problems: (i) lower levels of labor mobility, (ii) greater commuting times, and (iii) fewer new businesses. The argument is not that owners themselves are disproportionately unemployed. Evidence suggests, instead, that the housing market can produce negative 'externalities' upon the labor market. The time lags are long. That gradualness may explain why these important patterns are so little-known.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Paper provided by Peterson Institute for International Economics in its series Working Paper Series with number WP13-3.

in new window

Date of creation: May 2013
Date of revision:
Handle: RePEc:iie:wpaper:wp13-3
Contact details of provider: Postal: 1750 Massachusetts Avenue, NW, Washington, DC 20036-1903
Phone: 202-328-9000
Fax: 202-659-3225
Web page:

More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Jani-Petri Laamanen, 2013. "Home-ownership and the Labour Market: Evidence from Rental Housing Market Deregulation," Working Papers 1389, University of Tampere, School of Management, Economics.
  2. Petrongolo, Barbara & Pissarides, Christopher, 2000. "Looking Into The Black Box: A Survey Of The Matching Function," CEPR Discussion Papers 2409, C.E.P.R. Discussion Papers.
  3. Hughes, Gordon & McCormick, Barry, 1981. "Do Council Housing Policies Reduce Migration between Regions?," Economic Journal, Royal Economic Society, vol. 91(364), pages 919-37, December.
  4. Di Tella, R. & MacCulloch, R.J.: Oswald, A.J., 1997. "The Macroeconomics of Happiness," Papers 19, Centre for Economic Performance & Institute of Economics.
  5. Fernando Ferreira & Joseph Gyourko & Joseph Tracy, 2008. "Housing Busts and Household Mobility," NBER Working Papers 14310, National Bureau of Economic Research, Inc.
  6. Michael Svarer & Michael Rosholm & Jacob Roland Munch, 2003. "Are Home Owners Really more Unemployed?," CAM Working Papers 2003-09, University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics.
  7. Harminder Battu & Ada Ma & Euan Phimister, 2008. "Housing Tenure, Job Mobility and Unemployment in the UK," Economic Journal, Royal Economic Society, vol. 118(527), pages 311-328, 03.
  8. Oswald, Andrew J. & Wu, Stephen, 2010. "Objective Confirmation of Subjective Measures of Human Well-being: Evidence from the USA," IZA Discussion Papers 4695, Institute for the Study of Labor (IZA).
  9. van Leuvensteijn, Michiel & Koning, Pierre, 2004. "The effect of home-ownership on labor mobility in the Netherlands," Journal of Urban Economics, Elsevier, vol. 55(3), pages 580-596, May.
  10. 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.
  11. Allen Head & Huw Lloyd-Ellis, 2012. "Housing Liquidity, Mobility, and the Labour Market," Review of Economic Studies, Oxford University Press, vol. 79(4), pages 1559-1589.
  12. Dohmen, Thomas J., 2005. "Housing, mobility and unemployment," Regional Science and Urban Economics, Elsevier, vol. 35(3), pages 305-325, May.
  13. Smith, Tony E & Zenou, Yves, 2003. "Spatial Mismatch, Search Effort and Urban Spatial Structure," CEPR Discussion Papers 3731, C.E.P.R. Discussion Papers.
  14. Olivier Jean Blanchard & Lawrence F. Katz, 1992. "Regional Evolutions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 23(1), pages 1-76.
  15. Dale T. Mortensen & Christopher A. Pissarides, 1993. "Job Creation and Job Destruction in the Theory of Unemployment," CEP Discussion Papers dp0110, Centre for Economic Performance, LSE.
  16. Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-78, December.
  17. Dickens William T. & Triest Robert K., 2012. "Potential Effects of the Great Recession on the U.S. Labor Market," The B.E. Journal of Macroeconomics, De Gruyter, vol. 12(3), pages 1-41, October.
  18. Layard, Richard & Nickell, Stephen & Jackman, Richard, 2005. "Unemployment: Macroeconomic Performance and the Labour Market," OUP Catalogue, Oxford University Press, number 9780199279173.
  19. Florence Goffette-Nagot & Claire Dujardin, 2008. "Does public housing occupancy increase unemployment?," Working Papers 0833, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
  20. Serafinelli, Michel, 2013. "Good Firms, Worker Flows and Productivity," MPRA Paper 47508, University Library of Munich, Germany.
  21. Coulson, N. Edward & Fisher, Lynn M., 2009. "Housing tenure and labor market impacts: The search goes on," Journal of Urban Economics, Elsevier, vol. 65(3), pages 252-264, May.
  22. Oswald Andrew J., 1996. "A Conjecture on the Explanation for High Unemployment in the Industrialized Nations : Part I," The Warwick Economics Research Paper Series (TWERPS) 475, University of Warwick, Department of Economics.
  23. Zabel, Jeffrey E., 2012. "Migration, housing market, and labor market responses to employment shocks," Journal of Urban Economics, Elsevier, vol. 72(2), pages 267-284.
  24. Michel Serafinelli, 2015. "Good Firms, Worker Flows and Local Productivity," Working Papers tecipa-538, University of Toronto, Department of Economics.
  25. Kari Hämäläinen & Petri Böckerman, 2004. "Regional Labor Market Dynamics, Housing, and Migration," Journal of Regional Science, Wiley Blackwell, vol. 44(3), pages 543-568.
  26. William T. Dickens & Robert K. Triest, 2012. "Potential effects of the Great Recession on the U.S. labor market," Working Papers 12-9, Federal Reserve Bank of Boston.
  27. William A. Fischel, 2004. "An Economic History of Zoning and a Cure for its Exclusionary Effects," Urban Studies, Urban Studies Journal Limited, vol. 41(2), pages 317-340, February.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:iie:wpaper:wp13-3. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peterson Institute webmaster)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.