REGIONAL HETEROGENEITY AND THE REFINANCING CHANNEL OF MONETARY POLICY

• 成果类型: Article
• 署名作者: Beraja, Martin; Fuster, Andreas; Hurst, Erik; Vavra, Joseph
• 署名单位: Massachusetts Institute of Technology (MIT); National Bureau of Economic Research; Swiss National Bank (SNB); University of Chicago
• 刊物名称: QUARTERLY JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0033-5533
• DOI: 10.1093/qje/qjy021
• 发表日期: 2019
• 页码: 109-183
• 关键词: house prices; consumption; DYNAMICS; COSTS; constraints; inflation; mortgages; insurance; equity; rates

摘要

We argue that the time-varying regional distribution of housing equity influences the aggregate consequences of monetary policy through its effects on mortgage refinancing. Using detailed loan-level data, we show that regional differences in housing equity affect refinancing and spending responses to interest rate cuts, but these effects vary over time with changes in the regional distribution of house price growth. We build a heterogeneous household model of refinancing with mortgage borrowers and lenders and use it to explore the monetary policy implications arising from our regional evidence. We find that the 2008 equity distribution made spending in depressed regions less responsive to interest rate cuts, thus dampening aggregate stimulus and increasing regional consumption inequality, whereas the opposite occurred in some earlier recessions. Taken together, our results strongly suggest that monetary policy makers should track the regional distribution of equity over time. JEL Codes: E21, E52, G21.