This paper shows that rising real estate prices reduce industry productivity, because they lead to a reallocation of capital and labor towards inefficient firms. I establish that the rise in real estate value during the US housing boom relaxes firms' financial constraints. Companies borrow...

If mortgage borrowers default strategically, their future house price expectations should affect their present mortgage default decisions. Merging the Freddie Mac loan performance dataset with the Michigan Survey of Consumers data containing households' subjective expectations, this paper...

The demographic change underway, declining adequacy levels from traditional pay-as-you-go old-age social security systems, structural reforms in pension schemes and the reduction in the traditional family support have increased the need for additional private savings to cover the old age income...

The demographic change underway, declining adequacy levels from traditional pay-as-you-go old-age social security systems, structural reforms in pension schemes and the reduction in the traditional family support have increased the need for additional private savings to cover the old age income...

This chapter surveys the literature on housing in macroeconomics. We first collect facts on house prices and quantities in both the time series and the cross section of households and housing markets. We then present a theoretical model of frictional housing markets with heterogeneous agents...

A feature of last decade’s mortgage crisis was that the credit risk of borrowers was not accurately priced into their mortgages. For example, the increased risk of delinquency was not associated with a higher interest rate. I confirm this belief by using a measure of earnings risk, a major...