This chapter discusses computational methods for approximating portfolio and asset pricing problems. Formulation of these problems is usually specified along with components, preferences, payoffs, etc., that are analytic functions. This implies that the solutions to these problems acquire this...

In contrast to corporate and institutional investors, single owner-occupiers cannot adequately diversify housing investment risk. Consequently, homeownership should be relatively less likely in places with higher housing investment risk. Using the American Housing Survey, it is documented that...

Recent work uses mean-variance portfolio theory to identify optimal spatial conservation planning in the face of spatial variation in future benefits from uncertainty in climate change. Use of variance to measure risk may lead to inefficient portfolio allocation decisions when returns do not...

Households who wish to extract home equity through refinancing their mortgage face a hidden transaction cost. The real value of the fixed nominal mortgage payment declines over time with inflation. The change in the real value of the mortgage payments from taking on a new mortgage is positive...

Homestead exemptions to personal bankruptcy allow households to retain their home equity up to a limit determined at the state level. Households that may experience bankruptcy thus have an incentive to bias their portfolios towards home equity. Using US household data from the Survey of Income...

Classical residential location choice models were constructed as uncertainty-free. Using the expected utility theorem, urban researchers have dealt with different types of uncertainties, such as uncertain income, uncertain housing price, uncertain transportation cost, etc. This paper, however,...

This paper studies the effects of the U.S. rising earnings inequality between the late 1960s and the mid 1990s on the portfolio allocation and prices of assets. In order to investigate the link, a life-cycle general equilibrium model is constructed where distinct characteristics of the housing...