Date of Award
Union College Only
Bachelor of Arts
housing, regressions, slump, altered, appears
Spillover effects of a troubled housing market have become increasingly relevant in the past few months. Many economists have hypothesized that a housing slump would lead to a subsequent slump in consumer spending. Using city-level data in the United States, obtained from 2001-2006, this paper finds that consumption is not altered by housing price fluctuations. Several approaches are taken to test this conclusion, including variations in OLS regressions and TSLS regressions. The finding is universal that there appears to be no housing wealth effect regardless of the magnitude of housing appreciation or depreciation.
Haynes, Thomas P., "The wealth effect of the housing market" (2008). Honors Theses. 1470.