Research & Projects
Research & Projects
Between 2010 and 2015, China’s urban homeownership rate increased by 8.5 percentage points. This paper examines the drivers of this surge using a general equilibrium overlapping-generations (OLG) model with life-cycle housing tenure choice. The model incorporates heterogeneous agents and fixed-payment mortgages to quantify the effects of four concurrent policy and market developments: reductions in down-payment requirements, declines in mortgage rates, the emergence of online real estate platforms, and the expansion of subsidized affordable housing programs. Calibrated to Chinese data, the model shows that in the short run, the combined effect of four factors can increase homeownership rate by about 7.5%. In addition, reductions in mortgage rates and targeted subsidies account for the majority of the increase. A cut in mortgage rates raises ownership by 4.5%, while the expansion of affordable housing programs increases it by 4.7%. Welfare analysis further indicates that the combined reforms enhance household well-being, with the largest welfare gains stemming from lower mortgage rates.
We explore the link between county-level opioid prescription rates and asset prices, specifically, stock returns of firms headquartered in that county, as well as real estate prices. To examine the causal effects of opioid prescription rates on firm stock returns, we first apply an instrumental variable (IV) regression approach and use the opioid prescription rates for old population as the instrumental variable. The results provide robust evidence that opioid prescription rates have a negative causal effect on the equity returns of firms headquartered in that county. Furthermore, we analyze the effect of multiple regulations across states aimed at reducing controlled substance overdose and implement a dynamic difference-in-differences (DiD) estimation. The DiD estimation results show that this policy change has a positive dynamic effect on Californian firms' equity returns. We also find the opioid prescription reduction assistance program provided by California Health Care Foundation (CHCF) raises the median prices of existing single-family homes in those counties by $28,678 on average.
House-Without-Loan vs. Mortgage Rate Cuts: Evaluating the Impact of
Post-COVID Housing and Land Policies in China
This paper develops a life-cycle model with housing tenure choice and land finance to conduct counterfactual analysis of three major post-pandemic policy interventions: credit-relaxation measures, land-use efficiency improvements through idle-land reclamation, and mortgage-eligibility reforms shifting from ``Recognize House and Loan'' to ``Recognize House, Not Loan.'' It evaluates the long-run effects of these policies on housing stock, government revenue, and welfare. Credit-relaxation policies generate only modest increases in housing stock while boosting government revenue by about 35% and delivering large welfare gains. Land-use efficiency reforms raise average housing size by 6.73--14.28% but reduce welfare. The mortgage-eligibility reform expands the housing stock and increases welfare by 1.84%, while its fiscal impact remains modest.
We explore the link between county-level opioid prescription rates and asset prices, specifically, stock returns of firms headquartered in that county, as well as real estate prices. To examine the causal effects of opioid prescription rates on firm stock returns, we first apply an instrumental variable (IV) regression approach and use the opioid prescription rates for old population as the instrumental variable. The results provide robust evidence that opioid prescription rates have a negative causal effect on the equity returns of firms headquartered in that county. Furthermore, we analyze the effect of multiple regulations across states aimed at reducing controlled substance overdose and implement a dynamic difference-in-differences (DiD) estimation. The DiD estimation results show that this policy change has a positive dynamic effect on Californian firms' equity returns. We also find the opioid prescription reduction assistance program provided by California Health Care Foundation (CHCF) raises the median prices of existing single-family homes in those counties by $28,678 on average.
This paper provides the first tenure-specific estimates of economic housing depreciation in China and clarifies its functional form. Leveraging 1,776 dwellings from the China Family Panel Studies, this study extends the Shilling et al. (1991) framework by netting out land-price heterogeneity through county fixed effects in a hedonic price model. The results reject linear and convex specifications while showing that depreciation follows a geometric profile. The implied annual depreciation rates are 0.60 % for owner-occupied units and 1.75 % for renter-occupied units, indicating that rental housing loses value nearly three times faster than comparable owner housing. These tenure-differentiated geometric parameters reshape risk-return trade-offs––faster rental decay raises maintenance outlays, shortens optimal holding periods and widens required risk premia, whereas slower owner-occupied decay preserves long-duration wealth, thereby refining collateral valuation, and real estate investment underwriting.