Papers

Substitutability in the demand for housing over small distances September, 2023.

Abstract   Some pairs of residential locations are better substitutes than others, perhaps even within two hundred meters’ distance. As a result, rents and home prices can depart from the predictions of the most common urban models. The imperfect and varying substitutability between locations may arise due to preferences, information, or moving costs. Literatures in economics and complementary disciplines shed surprisingly little light on the spatial substitutability of housing, the housing search process, or the information accessed by housing searchers...

Single-family zoning and race: Evidence from the Twin Cities with MaryJo Webster, March 2023, original 2022.  Housing Policy Debate. (Ungated pre-publication version here).

Abstract   The city of Minneapolis recently changed its zoning to allow 2- and 3-family houses in formerly single-family zones, in part with the goal of furthering racial integration. To test whether this policy approach holds promise, we assemble digital zoning data covering the Minneapolis–St. Paul metro area and quantify the relationship between different types of residential zoning and racial and ethnic shares of neighborhood populations...

Foundations and Microfoundations: Building Houses on Regulated Land October 2021, original 2020. 

Abstract   The most common land use regulations in the U.S. govern lot size and structural intensity. I specify a residential builder’s profit maximization problem that distinguishes between yard space and covered land and incorporates common regulations as constraints. The model yields a closed-form solution for the cost of minimum lot sizes and coverage ratios...

Decomposing Housing Unaffordability May 2021, original 2020. Critical Housing Analysis 8 (1).

Abstract   A U.S. household is considered “rent burdened” when its rent exceeds 30 percent of its income... I rewrite the equation for rent burden as a sum of four factors: rent gap, income gap, excess size cost, and demographic baseline, and show that U.S. rental unaffordability is mostly the result of low incomes. Focusing on the New England region, however, I show that high rent is the primary cause of unaffordability in high-cost, high-wage metro areas...

Does Census Hiring Stimulate Job Growth? July 2020, original 2013. IZA Journal of Labor Policy 10 (1).

Abstract   Governments perform national, labor-intensive censuses on a regular schedule....This paper describes the construction of a data series on census hiring in the United States since 1950 and also collects available data on census employment in England and Wales, Canada, Korea, and Japan. Regressing total employment changes on census hiring yields coefficients extremely close to 1, indicating that there is no spillover from census hiring to the rest of the economy...

California Zoning: Housing Construction and a New Ranking of Local Land Use Regulation with Olivia Gonzalez, August 2019. Mercatus Research Paper. 

Abstract New survey data on residential land use regulation in California have allowed us to create the Mercatus-Augmented Terner California Housing Regulation (MATCHR) Index, which characterizes formal restrictions on density in 265 California jurisdictions circa 2018. To expand index coverage, we augment the original Terner California Residential Land Use Survey data with published regulatory data. The formal restrictions are internally correlated, and exploratory factor analysis yields a strong single factor that can be used as an index of regulatory intensity...

The MATCHR Index (Table A1) can be downloaded here.

Do Minimum-Lot-Size Regulations Limit Housing Supply in Texas? with M. Nolan Gray, May 2019. Mercatus Research Paper.

Abstract Minimum lot sizes regulate the density of housing in almost all American municipalities. Our findings suggest that even moderate lot size minimums in rapidly growing Texas suburbs constrain density. Market outcomes are consistent with strong demand for single-family detached housing units built on lots of 5,000 to 7,000 square feet, a lot size rarely allowed by local zoning laws...

Housing Supply in the 2010s February 2019, original 2018.

Abstract Geographic patterns of housing growth in the U.S. result from the interaction of demand, density, and regulatory institutions. This paper presents a model of urban redevelopment in which opportunity costs and regulatory hurdles impact the occurrence, timing, and density of redevelopment. Regulations may inhibit the parcel's redevelopment through costs, delays, constraints, or rent control, each of which are shown to impact potential redevelopment differently. Unlike in models of greenfield development, the local distribution of existing uses will be a key determinant in the response to a shock or regulation and housing supply curves will be S-shaped. Non-parametric estimation of housing supply growth from 2012 to 2018 as a function of demand growth and density yields a residual growth surplus for each census tract...

Risky Adoption April 2012, original 2011

Abstract   Terms of trade volatility has a strong negative effect on growth in developing countries. In this paper, I show that much of the cross-country variance in productivity growth can be explained by differential rates of technology adoption due to differing terms of trade volatility. Intuitively, high price volatility in one sector of a developing economy leads to volatility throughout the economy..

Terms of Trade Volatility and Precautionary Savings in Developing Economies  March 2012, original 2010

Abstract   This paper investigates the link between terms of trade volatility and long-term output growth in developing countries. I find that differences in terms of trade volatility account for 20% of the cross-country variation in growth from 1980 to 2009. The magnitude is arresting: a standard-deviation difference in exposure to terms of trade volatility between two countries is associated in the data with a 16-percentage-point difference in overall output growth...

Current Account and the Planner's Pecuniary Tradeoff  June 2011, original 2008

Abstract   Large, sustained changes in current accounts are among the most significant global macroeconomic trends of the last quarter century. Since relative parity during 1950-1980, the U.S. current account deficit (along with the closely correlated trade deficit) has rapidly ballooned to over 6% of GDP. In the meantime, the current account surpluses of Asian economies have grown correspondingly – Japan’s in the 1980’s, China’s and India’s more recently, along with a host of smaller developing countries.

I extend and qualify the now-familiar argument that current account imbalance may be optimal...

A Parsimonious Model of International Risk Sharing  July 2010, original 2009

Abstract  This exercise is a solution to the international equity premium puzzle consists of a reconciliation of the observed equity premia and the cross-country consumption correlations observed in the data. I show that a two-country OLG model can deliver a large spread between stock and bond returns (i.e. a high equity premium) and high international risk sharing despite low consumption correlations...