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Supply Elasticity and the Housing Cycle of the 2000s
Author(s) -
Davidoff Thomas
Publication year - 2013
Publication title -
real estate economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.064
H-Index - 61
eISSN - 1540-6229
pISSN - 1080-8620
DOI - 10.1111/1540-6229.12019
Subject(s) - economics , elasticity (physics) , price elasticity of supply , proxy (statistics) , price elasticity of demand , econometrics , supply and demand , microeconomics , computer science , materials science , machine learning , composite material
There is no evidence that differences in supply elasticity caused cross‐sectional variation among U.S. housing markets in the severity of the 2000s housing cycle. This is true in three sets of empirical specifications: a first that assumes identical demand changes in the 2000s across markets, a second that proxies for supply elasticity and demand changes in the 2000s with estimates based on price and quantity changes in the 1980s and a third that uses physical and regulatory constraints to proxy for supply elasticity and uses state fixed effects to capture variation in demand conditions.