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OPPORTUNISTIC MATCHING IN THE HOUSING MARKET *
Author(s) -
Albrecht James,
Anderson Axel,
Smith Eric,
Vroman Susan
Publication year - 2007
Publication title -
international economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.658
H-Index - 86
eISSN - 1468-2354
pISSN - 0020-6598
DOI - 10.1111/j.1468-2354.2007.00440.x
Subject(s) - matching (statistics) , variance (accounting) , economics , poisson distribution , econometrics , distribution (mathematics) , construct (python library) , conditional variance , flow (mathematics) , joint probability distribution , margin (machine learning) , microeconomics , mathematics , computer science , statistics , volatility (finance) , mathematical analysis , geometry , accounting , programming language , autoregressive conditional heteroskedasticity , machine learning
We construct a model of the housing market in which agents differ in their flow values while searching. Agents enter the market relaxed (with high flow values) but move to a desperate state (low flow values) at a Poisson rate if they have not already transacted. We characterize the equilibrium steady‐state matching pattern and the joint distribution of price and time to sale (for sellers). The expected price conditional on time to sale falls with time spent on the market, whereas the conditional variance of price first rises and then falls with time on the market.