The Rent - to - Price is Right ( After Controlling for Unobserved Quality ) - Preliminary ∗
نویسندگان
چکیده
Abstract We use a large repeated cross-section of properties to estimate a selection model of the supply of owner-occupied and rental housing. We find that physical characteristics and unobserved quality and not location are important for selection. We interpret this as strong evidence in favor of contracting frictions in the rental market relating to maintenance and modification of physical housing characteristics. Accounting for selection is important for estimates of rent-to-price ratios and can explain some puzzling correlations between rent-to-price ratios and homeownership rates.
منابع مشابه
طراحی و بکارگیری فیلترهای تصحیح کننده خطا برای محاسبه ارزش سهام شرکت های برق
The shares of state-owned or public companies are supplied in privatization plan. If the financial market be clear and efficient, it is expected that discovered price of supplied shares be efficient too. However, there is no guarantee for the fulfillment of this condition. Specially, implementation of those policies that, for example, a shock to exchange rate or the price of inputs (such as fue...
متن کاملWhat factors drive the price–rent ratio for the housing market? A modified present-value analysis
We consider which factors determined the price–rent ratio for the housing market in 18 U. S. metropolitan statistical areas (MSAs) and at the national level over the period of 1975– 2014. Based on a present-value framework, our proposed empirical model separates the price–rent ratio for a given market into unobserved components related to the expected real rent growth and the expected housing r...
متن کاملImproving envelopment in data envelopment analysis by means of unobserved DMUs: an application of banking industry
In data envelopment analysis, the relative efficiency of a decision making unit (DMU) is defined as the ratio of the sum of its weighted outputs to the sum of its weighted inputs allowing the DMUs to freely allocate weights to their inputs/outputs. However, this measure may not reflect a the true efficiency of a DMU because some of its inputs/outputs may not contribute reasonably in computing t...
متن کاملIncome Inequality and Housing Affordability in Selected Metropolises of Iran: A Pseudo-Panel Approach
Housing is one of the most important and most expensive assets of the human life. It is an expensive commodity that requires long-term planning to purchase it, so housing affordability in the household budget portfolio is one of the most important issues. In this paper, based on Zhang (2015) model and Matlack and Vigdor (2008) study and using a cross-sectional household income - expenditure mic...
متن کاملThreshord Effect of the Economic Growth Rate on the Development of Renewable Energy: Evidences from OPEC Countries
This paper studies the non linear relationship between energy prices, natural resources rent opportunities and renewable energy consumption under different economic growth rates for OPEC member countries during the 2005-2016 period. Using a panel smooth transition regression (PSTR) model, our findings prove a non-linear relationship between renewable energy consumption and the rate of economi...
متن کامل