THE MORTGAGE PIGGY BANK: BUILDING WEALTH THROUGH AMORTIZATION

• 成果类型: Article
• 署名作者: Bernstein, Asaf; Koudijs, Peter
• 署名单位: University of Colorado System; University of Colorado Boulder; National Bureau of Economic Research; Erasmus University Rotterdam - Excl Erasmus MC; Erasmus University Rotterdam
• 刊物名称: QUARTERLY JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0033-5533
• DOI: 10.1093/qje/qjae011
• 发表日期: 2024
• 页码: 1767-1825
• 关键词: consumption; income; payment; savings; lottery; CHOICE; debt

摘要

In 2013, the Dutch government mandated that new conforming mortgages must fully amortize. Within a difference-in-differences design, we estimate that the marginal wealth accumulation from amortization is close to one, even five years later. Households purchasing after the reform primarily cut consumption and leisure over other savings, leading to a rise in wealth. This holds if we use life events to instrument for the timing of home purchase. Estimates are similar for seemingly unconstrained households and movers, suggesting a broad applicability of our results. Consistent with a simple model, we find lower estimates for households that appear less financially sophisticated or willing to adjust short-term consumption. Mortgage amortization schedules are among the largest savings plans in the world, and our results highlight their critical importance for household wealth building and macroprudential policies.