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Beyond Unemployment and Inflation: Housing Unaffordability as a Macroeconomic Misery Component

Author

Listed:
  • Haifang Huang

    (University of Alberta)

  • John Helliwell

    (University of British Columbia)

Abstract

We ask whether housing unaffordability belongs in the misery index, pairing national house prices with the Gallup World Poll for up to 57 economies. Worsening affordability is robustly associated with lower average Cantril life evaluation: a ten percent rise in house prices, holding per-capita income fixed, weighs as heavily as a one-to-two percentage-point rise in unemployment. Housing belongs in the index. Equity prices, in contrast, carry little weight. The burden appears independently in the Integrated Values Surveys, which measure life satisfaction instead. In Gallup, the young and the middle-aged carry similar penalties, and even seniors are not completely spared.

Suggested Citation

  • Haifang Huang & John Helliwell, 2026. "Beyond Unemployment and Inflation: Housing Unaffordability as a Macroeconomic Misery Component," Working Papers 2026-10, University of Alberta, Department of Economics.
    • Handle: RePEc:ris:albaec:023641
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    File URL: https://sites.ualberta.ca/~econwps/2026/wp2026-10.pdf
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    Keywords

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    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity

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