Research

"Reverse Mortgages and Intergenerational Risk-sharing during the Great Recession" (Job Market Paper) Download

Abstract:  A Reverse Mortgage Loan (RML) allows senior homeowners to smooth consumption across time and generations in response to uninsurable shocks. Meanwhile, RML borrowers lose the opportunity to bequeath the whole equity of their home. Borrowing an RML is an intertemporal choice problem, which depends on various factors. This paper studies how intergenerational risk-sharing affects RML origination and intergenerational transfers during the housing boom and bust. I build an overlapping generations model with one-sided altruism to explain how a parent strategically behaves to maximize a dynasty's utility. I find that parents owning a relatively smaller home and scarce liquid assets are the principal borrowers of an RML. As children's income increases, the RML take-up rate initially decreases and then increases. As the size of the bequest motive increases, the RML take-up rate decreases; however, more slowly during the recession.

"Spatial Sorting: Commercial Gentrification"  Download 

Abstract: This paper studies how the composition of businesses of different qualities changes between a gentrifying and a non-gentrifying neighborhood in response to higher rent. I investigate how actively commercial gentrification is going on in some neighborhoods, using Yelp data. Then, I construct a search and matching model with heterogeneous neighborhoods, rents, and externalities. The model predicts a higher portion of high-quality businesses and faster growth in rents in a gentrifying neighborhood than a non-gentrifying neighborhood. According to Yelp data, a neighborhood where experiences active commercial gentrification experiences rapid growth in customers' average business evaluation.

"The Effect of School Choices on Housing Prices and Inequality" Download

Abstract: Open enrollment policies provide more public school options by allowing a student to transfer to a public school of her choice regardless of residency. This paper investigates the effect of open enrollment on housing prices and income inequality. I consider school districts in Arizona and North Carolina, as opposite extremes in enrollment policies. I find some evidence on the effect of open enrollment on housing prices and income inequality. In a state with open enrollment, housing prices increase with the number of better schools far from home. The Gini coefficient decreases with the quality of public education in a state with open enrollment. In an overlapping generations model with altruism, I examine how changes in the quality of public education, private school tuition, and transportation cost affect housing prices and income inequality across states.