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Rent Control and Unemployment Duration

Author

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  • Svarer, Michael

    (Aarhus University)

  • Rosholm, Michael

    (Aarhus University)

  • Munch, Jakob R.

    (University of Copenhagen)

Abstract

In this paper we investigate whether rent control affects the functioning of the labour market. Particularly, we focus on the effect of rent control on the length of individual unemployment duration. Theoretically, the effect is ambiguous. Rent control reduces housing mobility and could very well spill-over to mobility in the labour market. On the other hand to maintain their rent control benefits unemployed individuals are presumably less demanding when accepting a job in the local labour market. Based on a rich Danish data set we investigate the empirical contents of the issue, and find results that are in clear accordance with the theoretical predictions.

Suggested Citation

  • Svarer, Michael & Rosholm, Michael & Munch, Jakob R., 2003. "Rent Control and Unemployment Duration," IZA Discussion Papers 842, IZA Network @ LISER.
  • Handle: RePEc:iza:izadps:dp842
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    JEL classification:

    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • D45 - Microeconomics - - Market Structure, Pricing, and Design - - - Rationing; Licensing
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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