Financial frictions, the housing market, and unemployment

• 成果类型: Article
• 署名作者: Branch, William A.; Petrosky-Nadeau, Nicolas; Rocheteau, Guillaume
• 署名单位: University of California System; University of California Irvine; Federal Reserve System - USA; Federal Reserve Bank - San Francisco
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2015.07.008
• 发表日期: 2016
• 页码: 101-135
• 关键词: credit; unemployment; limited commitment; liquidity

摘要

We develop a two-sector search-matching model of the labor market with imperfect mobility of workers, augmented to incorporate a housing market and a frictional goods market. Homeowners use home equity as collateral to finance idiosyncratic consumption opportunities. A financial innovation that raises the acceptability of homes as collateral raises house prices and reduces unemployment. It also triggers a reallocation of workers, with the direction of the change depending on firms' market power in the goods market. A calibrated version of the model under adaptive learning can account for house prices, sectoral labor flows, and unemployment rate changes over 1996-2010. (C) 2015 Elsevier Inc. All rights reserved.