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This paper employs a calibrated model of the US economy to analyze the boom and bust in house prices as well as the shifts in the distribution of wealth during the years around the Great Recession. We replicate the dynamics of the housing market using shocks to aggregate income, the distribution...
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With the advent of EMU monetary policy can no longer be used to prevent housing market bubbles in regional economies … such as Ireland or Spain. However, fiscal policy can and should be used to achieve the same effect. This paper shows that … the advent of EMU relaxed existing financial constraints in Ireland and Spain, allowing a more rapid expansion of the …
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identify temporary house price bubbles, amplified by trend extrapolation, and crashes reinforced by fundamentalists. The …
Persistent link: https://www.econbiz.de/10010465137
Using data for 70 U.S. metropolitan areas, this study explores spatial heterogeneity in house price dynamics. We use recent advances in panel econometrics that allow for spatial heterogeneity, cross-sectional dependence, and non-stationary but cointegrated data. We test for spatial differences...
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