Housing, mobility and unemployment

IZA Discussion Paper No. 210

Housing, Mobility and Unemployment ∗ This paper develops a model that shows why high-skilled workers move more and are therefore unemployed less than low-skilled workers. The model can explain the paradoxical empirical regularity that higher owner-occupation rates are associated with higher levels of unemployment although home-owners tend to be unemployed less. The choice of housing tenure affe...

Housing Tenure and Labour Mobility: a Comparison across European Countries

This paper studies housing tenure and labour mobility using individual data from the ECHP for five European countries. First, the effect of housing tenure on the unemployed workers’ labour mobility is studied using a discrete unemployment duration model with two alternative exits to employment, depending on whether they are associated with a residential change or not. Ownership is found to affe...

Public Housing and Unemployment: Skills and Spatial Mismatch in Postindustrial Hong Kong

The impact of living in public rental housing on employment has been the subject of much debate internationally. Theory suggests that restrictions on residential mobility, neighborhood effects, and the place-based housing subsidy itself contribute to the higher rates of unemployment often observed among public housing tenants. However, recent evidence from Europe and Australia show that when pr...

The effect of the housing market on mobility and unemployment

Unemployment, Financial Frictions, and the Housing Market

We develop and calibrate a two-sector, search-matching model of the labor market augmented to incorporate a housing market and a frictional goods market. The labor market is divided into a construction sector and a non-housing sector, and there is perfect mobility of unemployed workers across sectors. In the frictional goods market households, who lack commitment, …nance random consumption oppo...