If you wonder about the pronunciation: [Yesper(-day) Bɜ-yɛ-reed]
I am a doctoral candidate at UCLA doing research in applied macroeconomics, using administrative household data, methods from applied microeconomics, and structural modeling to study the role of home prices and credit use in household finance, migration, and the macroeconomy.
I am on the 2023–2024 job market.
Why do workers stay in places in economic decline? This paper presents a housing wealth channel where declining housing wealth reduces the out-migration incentives of homeowners following a negative regional shock. I combine Norwegian administrative data with a life-cycle model that includes location, housing, and savings decisions. I exploit the 2014–2016 oil price plunge episode which reduced regional earnings and home prices significantly and permanently in the oil-exporting region of Stavanger and I empirically document the heterogeneous changes in moving behavior across housing tenures and wealth. I find increased out-migration among renters and low housing-wealth homeowners and observe decreased out-migration for high housing-wealth homeowners. The richness of the data allows me to control for potentially confounding factors. The model, consistent with the data, shows that the erosion of housing wealth reduces homeowners’ out-migration motives by lowering the value of other locations with better opportunities and the effect increases with housing wealth. These results highlight the importance of general equilibrium effects to understand the heterogeneity in migration responses and that low migration is driven by accompanying wealth shocks. Policies like moving subsidies benefit mobile renters and can amplify the housing wealth effect on less mobile homeowners, further reducing the out-migration incentive.
Contact: bojeryd91 at gmail dot com
Empirical studies have estimated a big range of consumption response sizes to changes in house prices. Using a quasi-experiment, we estimate a shock of –19.4 percent to house prices in the area surrounding an airport in Stockholm after its operations were unexpectedly continued as a result of political bargaining behind closed doors. This source of price divergence is ideal for identifying housing wealth effects since it is local and unrelated to variations in macroeconomic conditions. Using a household data set with information on the location of primary residence relative to the airport, we find a short-run elasticity with respect to new car purchases of 0.39, corresponding to a one-year marginal propensity for car expenditures of 0.12 cents per dollar lost in housing wealth. Households with high loan-to-value ratios and little bank deposits respond the most. A quantitative model is consistent with the empirical findings and pinpoints important determinants of the response size, which may explain the variation in previous estimates.