Consumption Commitments and Housing Dynamics

• 成果类型: Article; Early Access
• 署名作者: Kantak, Preetesh
• 署名单位: Indiana University System; IU Kelley School of Business; Indiana University Bloomington
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2022.01996
• 发表日期: 2025
• 关键词: Asset pricing; consumption commitments; Long-run risk; Real estate

摘要

Using a measure of local long-run growth prospects, I uncover a novel link between economic fundamentals and house prices. Whereas excess housing returns are positively associated with economic growth prospects, housing valuations are negatively associated with shocks to growth prospects. I document an explanation in metro-area consumption: housing consumption is asymmetrically exposed to economic prospects in that it expands more quickly when prospects are strong than it contracts when prospects are poor. I explain these findings through the lens of an asset pricing model that focuses on a trade-off between nonseparable committed housing and nonhousing consumption.