This event requires registration. After you register, you'll receive a confirmation email with instructions on how to join the event.

Date: Wednesday, November 9, 2022, at 11:00 am ET 

Speaker: Andrii Parkhomenko (USC) - "Homeownership, Polarization, and Inequality"

Abstract: The rise of income inequality and job polarization have been more pronounced in large U.S. cities. Most previous studies attributed this to skill-biased technical change (SBTC). I offer a novel explanation: when prices grow faster in large cities relative to rents and incomes, middle-income households increasingly cannot afford to buy a house. They move to smaller cities and the middle of the income distribution in large cities hollows out, making them more polarized and unequal. I document that (1) commuting zones with higher price growth experienced larger polarization and increase in inequality and (2) middle-income households move more often to cheaper states for housing-related reasons than low- or high-income households. I build a spatial equilibrium model with tenure choice consistent with this evidence. I find that, while SBTC can cause larger polarization and inequality in big cities, its effect is greatly amplified by declining housing affordability since 1980.

Paper Link: https://www.andrii-parkhomenko.com/files/Parkhomenko_HPI.pdf

Registration Link: https://psu.zoom.us/webinar/register/WN_d0QyO2jwReCXXuwSyOuhzA

Host: Tess Scharlemann ([email protected])