TY - JOUR
T1 - Unemployment risk and the timing of homeownership in Japan
AU - Moriizumi, Yoko
AU - Naoi, Michio
N1 - Funding Information:
The authors are grateful to the Global Center of Excellence (GCOE) program at Keio University for generously providing us with the Keio Household Panel Survey (KHPS). The authors would like to thank Hideo Akabayashi, Edwin Deutsch, Colin R. McKenzie, Masayuki Nakagawa, Viggo Nordvik, Piyush Tiwari, two anonymous referees, and the Editor for their helpful comments and suggestions. The first author (Yoko Moriizumi) acknowledges a Grant-in-Aid (# 19530191 ) for Scientific Research (C) from the Ministry of Education Culture, Sports, Science and Technology . The second author (Michio Naoi) acknowledges a Grant-in-Aid (# 19730183 ) for Young Scientists from the Ministry of Education, Culture, Sports, Science and Technology.
PY - 2011/5
Y1 - 2011/5
N2 - We examine the effect of unemployment risk on the timing of homeownership applying a survival analysis approach. Empirical results from the Split Population Duration (SPD) model suggest that: (1) unemployment risk has a significantly negative effect on homeownership and delays its timing even after controlling for income variability measures, (2) the null hypothesis that every household will eventually become a homeowner is rejected, which supports the SPD model against the standard duration model, and (3) the standard duration model underestimates the effects of both unemployment risk and income variability. Finally, our simulation results indicate that changes in unemployment risk have a fairly large impact on the probability of home purchase-a 10 percentile increase in unemployment probability from its median level would reduce the probability by 2.0 percentage point, whereas comparable changes in income variability measures would reduce the probability mere 0.2-0.3 percentage points.
AB - We examine the effect of unemployment risk on the timing of homeownership applying a survival analysis approach. Empirical results from the Split Population Duration (SPD) model suggest that: (1) unemployment risk has a significantly negative effect on homeownership and delays its timing even after controlling for income variability measures, (2) the null hypothesis that every household will eventually become a homeowner is rejected, which supports the SPD model against the standard duration model, and (3) the standard duration model underestimates the effects of both unemployment risk and income variability. Finally, our simulation results indicate that changes in unemployment risk have a fairly large impact on the probability of home purchase-a 10 percentile increase in unemployment probability from its median level would reduce the probability by 2.0 percentage point, whereas comparable changes in income variability measures would reduce the probability mere 0.2-0.3 percentage points.
KW - J64
KW - R21
KW - SPD model
KW - Timing of homeownership
KW - Unemployment risk
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U2 - 10.1016/j.regsciurbeco.2010.12.001
DO - 10.1016/j.regsciurbeco.2010.12.001
M3 - Article
AN - SCOPUS:79953037817
VL - 41
SP - 227
EP - 235
JO - Regional Science and Urban Economics
JF - Regional Science and Urban Economics
SN - 0166-0462
IS - 3
ER -