Home Equity and Labor Income: The Role of Constrained Mobility

• 成果类型: Article
• 署名作者: Gopalan, Radhakrishnan; Hamilton, Barton H.; Kalda, Ankit; Sovich, David
• 署名单位: Washington University (WUSTL); Indiana University System; Indiana University Bloomington; University of Kentucky
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhaa136
• 发表日期: 2021
• 页码: 4619
• 关键词: MORTGAGE DEFAULT EVIDENCE; negative equity; housing-market; loss aversion; seller behavior; prices; unemployment; foreclosure; IMPACT; debt

摘要

Using detailed data for U.S. homeowners, we document a negative, nonlinear relation between the loan-to-value ratio (LTV) of homeowners' primary residence and their labor income. Consistent with high LTV individuals experiencing constrained mobility, we find stronger effects among subprime, liquidity- constrained individuals and those living in regions with limited alternative local employment opportunities and strict noncompete law enforcement. Though high LTV individuals are less likely to move across MSAs, they are more likely to change jobs without changing their residence. We find no effects among similar neighboring renters employed at the same firm and with a similar job tenure.