The Equity of Alternative Policies for the Australian Homeowner*

The income-tax treatment of homeowners and renters is an important instrument of national housing policy. Major changes in the treatment of homeowners occurred in 1975 and 1976; the second change focused especially on the problems of first-buyers and was coincident with an expanded home-savings grant scheme. As a further reform several writers have advocated the taxation of the rent imputed to homeowners. This paper develops a user cost of capital approach to estimate the distribution of housing costs along the income scale and between policy alternatives. The model indicates the vital importance of accounting for inflation whenever physical housing costs are inflating but mortgage costs are fixed in nominal terms. Although inflation is increasing housing costs at all income levels, high-income homeowners appear to be suffering the greatest cost increases as the result of inflation. Furthermore, unless mortgages are indexed, the customary imputed-rent formula is regressive.     

Homeownership,Mobility, And Local Income Redistribution

Regions are characterized by different homeownership rates. Homeowners and renters differ in their mobility costs, renters having lower mobility costs. This paper analyses how the presence of those different types of households affects income sorting and tax differences between local jurisdictions. To this aim, we analyze a model of local income redistribution with mobile (renter) and immobile (homeowner) households. Linear income taxes finance a lump sum transfer. Policies are determined endogenously through voting. In such a framework, if there are no or only few homeowners, no income‐sorting equilibrium exists. Above a certain threshold for the homeownership rate we find an inverted U‐shaped relationship between tax differences and homeownership rates, such that tax differences between jurisdictions are highest for intermediate homeownership rates.     

Using spectral analysis and multinomial logit regression to explain households’ choice patterns

Many methods are available to analyze rank-ordered data. We used spectral analysis to identify the most preferred option of Formosan subterranean termites (FSTs) control as ranked by Louisiana homeowners. Respondents were asked to rank four termite control methods from the most preferred option to the least preferred option. Spectral analysis of complete ranked data indicated that the most preferred FST control choice is a relatively cheap ($0.13/square foot) option of a liquid treatment. Similarly, analysis indicated that liquid and bait treatments are the two most desired control choices. Multinomial logit analysis indicated that survey location, household pre-tax income, and knowledge of FSTs determined Louisiana homeowners’ ranking pattern choices.     

Does homeownership promote wealth accumulation?

It is well known that homeowners are richer than renters, even after controlling for observable household characteristics. This is often used as an argument for policies that foster homeownership. However, the causal link between homeownership and wealth is difficult to establish due to many potential sources of endogeneity. Utilizing the Household Finance and Consumption Survey for the Euro area, we correct for endogeneity by using inheriting the household’ s main residence as an instrument. The exclusion restriction is that conditional on the total amount of inheritance, inheriting a home affects the wealth position of the household only through homeownership. For the sample of inheritors we find that the local average treatment effect for households that inherit a home and stay homeowners is negative. Owning a home reduces riches due to sizable reductions in the net holdings of financial and other real wealth of the treated households.     

On the user cost and homeownership

This paper studies the differences in the cost of housing services for renters and homeowners and calculates the bias that results when we value owner-occupied housing services using a rental equivalence approach. Our framework is a life-cycle model with endogenous tenure choice with households facing idiosyncratic uninsurable earnings risk and housing price risk. We model houses as illiquid assets that provide collateral for loans. To analyze the impact of preferential housing taxation on the tenure choice and the bias, we consider a tax system that mimics that of the US economy. Namely, owner-occupied housing services are not taxed and mortgage interest payments are deductible. Through simulations, we show that a rental equivalence approach (relative to a user cost approach) overestimates the cost of housing services. The magnitude of the bias is very sensitive to both the income tax rate and the size of adjustment costs in the housing market.     

Wealth Effects,Local Area Attributes,and Economic Prospects: On the Relationship between House Prices and Mental Wellbeing

This research exploits large variations in local house prices to investigate whether house prices correlate with mental wellbeing, and uses contrasting implications for the effect of house prices on the mental wellbeing of homeowners and renters to shed light on why this correlation might arise. I document a positive correlation between house prices and the mental wellbeing of both homeowners and non‐homeowners, which is inconsistent with a pure wealth effect. Instead this finding suggests that local house prices provide a reflection of available amenities and economic opportunities in the area.     

Who benefits most from property assessment taxes? Evidence from Los Angeles County

Assessment caps on property taxes are often assumed to benefit affluent homeowners the most with little gains for low-income households. Quantile regression results for Los Angeles County show that on average effective property tax rates decrease by $1994 per year due to length of ownership in the 50th percentile because of California’s Proposition 13 assessment cap. There is evidence of both horizontal and vertical inequity across the entire sample. Low-income households do benefit from California’s assessment cap as they are typically infrequent movers but their effective tax rates decrease over time. However, the most affluent households by market value do not gain the most and there is no evidence of horizontal inequity for these homeowners. There is also no evidence of horizontal inequity for middle-income households. Property tax savings vary between $18,000 and $40,000, depending on the assessed value decile and percentage quantile.     

INCOME REDISTRIBUTION THROUGH THE TAX SYSTEM: A SIMULATION ANALYSIS OF TAX REFORM

In this paper, we consider reforming the tax system to a comprehensive income tax model in order to amend the differential treatment of income sources. Our simulation analysis shows that the tax reform improves the effectiveness of the tax system on the redistribution of all sources of income including earned income, financial wealth income, and imputed rent. The analysis of incidence of the tax reform suggests that the tax burden for young renters decreases the most and that for young loan-free land owners increases the most through this tax reform.     

Willingness to pay for electric vehicles and their attributes

This article presents a stated preference study of electric vehicle choice using data from a national survey. We used a choice experiment wherein 3029 respondents were asked to choose between their preferred gasoline vehicle and two electric versions of that preferred vehicle. We estimated a latent class random utility model and used the results to estimate the willingness to pay for five electric vehicle attributes: driving range, charging time, fuel cost saving, pollution reduction, and performance. Driving range, fuel cost savings, and charging time led in importance to respondents. Individuals were willing to pay (wtp) from $35 to $75 for a mile of added driving range, with incremental wtp per mile decreasing at higher distances. They were willing to pay from $425 to $3250 per hour reduction in charging time (for a 50 mile charge). Respondents capitalized about 5 years of fuel saving into the purchase price of an electric vehicle. We simulated our model over a range of electric vehicle configurations and found that people with the highest values for electric vehicles were willing to pay a premium above their wtp for a gasoline vehicle that ranged from $6000 to $16,000 for electric vehicles with the most desirable attributes. At the same time, our results suggest that battery cost must drop significantly before electric vehicles will find a mass market without subsidy.     

Accounting for the decline in homeownership among the young

This paper documents that the drop in young homeownership is more persistent among non-college graduates compared to college graduates: while some college graduates postpone home purchasing, non-college graduates are likely to remain long-term renters. I develop a model showing that the combination of rising college share and a widening education-driven income gap accounts for the delayed purchasing of college graduates and the lack of purchasing among non-college graduates. Exploiting cross-city variation, I verify the implications of the model and show that the mechanism can quantitatively account for the diverging ownership decisions between the two education groups from 1980 to 2019.     

Income gap between poor families and others: Signs of individual freedom or proof of social inequality?

In 2001 the mean income deficit for poor families was $7,231. The mean income surplus for nonpoor families was $57,841. The sum of those two estimates—$65,072—represents what we call the family income gap. Between 1993 and 2000—the period marking the longest expansion in U.S. economic history—the real family income gap grew on average by $1,143 every year. This article examines the difference in income between poor and nonpoor families, 1988–2001; transitions into and out of poverty; the income gap in 2001 by race and type of family; and three remedies for closing the gap. Concluding remarks call attention to the linkage between our understanding of human nature and the way in which poverty is defined and measured. Mayo Research Institute     

The random expenditure function approach to welfare in RUM: The case of hazardous waste clean-up

This paper presents an application of the random expenditure function approach for welfare analysis in RUM with a non-linear income effect. The measures of expected compensating variation (CV) are first derived as special cases to apply to a two-option conjoint choice-based survey data aimed at deciphering homeowners’ willingness to pay for hazardous waste clean-up. A comparison of the expected CV with the CV based on the representative consumer approximation (CVr) reveals high degree of agreement between the estimates. Using the Diewert and Translog utility specifications the study finds that regardless of the methodology used, welfare estimates are quite sensitive to the functional forms.     

中等收入陷阱的国际实证比较及对中国启示

本文通过实证对比跨越和落入中等收入陷阱两类国家在入均GDP达到3000美元到突破1万美元期间经济社会方面的差异及演变过程,给出落入中等收入陷阱国家的判断依据,揭示中等收入陷阱的实质是效率陷阱,发现落入中等收入陷阱的成因主要有教育投入不足、失业率高、消费层次低、金融配置低及贫富差距过大等。同时,对中国落入陷阱的可能性进行判断分析,并就中国如何跨越中等收入陷阱给出一些建议。     

HOME EQUITY IN RETIREMENT

Retired homeowners dissave more slowly than renters, which suggests that homeownership affects retirees' saving decisions. We investigate empirically and theoretically the life-cycle patterns of homeownership, housing, and nonhousing assets in retirement. Using an estimated structural model of saving and housing decisions, we find first that homeowners dissave slowly because they prefer to stay in their house as long as possible but cannot easily borrow against it. Second, the 1996–2006 housing boom significantly increased homeowners' assets. These channels are quantitatively significant; without considering homeownership, retirees' net worth would be 28%–44% lower, depending on age.     

Gender and family issues in the workplace Edited by Francine D. Blau and Ronald G. Ehrenberg

In 2001 the mean income deficit for poor families was $7,231. The mean income surplus for nonpoor families was $57,841. The sum of those two estimates—$65,072—represents what we call the family income gap. Between 1993 and 2000—the period marking the longest expansion in U.S. economic history—the real family income gap grew on average by $1,143 every year.     

我国工资差异变化及影响因素分析——基于家计调查的实证研究

尽管中国在经济转型过程中取得了令世人瞩目的经济增长速度,但随之而来的是不断扩大的工资收入差异和持续扩大的工资收入差距引发了广泛关注.一般认为,工资差距过大对社会公平和正义造成伤害,并直接影响中国经济和社会的可持续发展.基于家计调查数据并使用经济计量模型分析方法,本论文对中国在过去二十年日益增长的工资差距进行实证分析并探讨影响工资差距的主要因素.研究表明,政府对劳动力市场机构特别是工资政策改革是引发工资差距不断扩大的原因之一.本论文指出,劳动力市场机构的变化不是造成工资差异扩大的唯一因素;其它重要因素包括劳动力市场歧视以及制度性障碍,如中国现行的户口政策造成的劳动力市场分割等.本论文还从政策层面对减少工资差异提出建议.     

跨越中等收入陷阱:国际经验与实现路径

通过对我国经济结构的分析,作者发现结构失衡是跨越中等收入陷阱的主要障碍,人口红利逐渐式微加剧了我国向高收入组跨越的难度。在调节结构失衡的过程中,应以收入分配改革为切入点,通过建立集体工资谈判制度、完善社会保障体制和财税政策来调节收入分配,将收入差距控制在合理范围内;同时,促进产业升级和技术创新,推动经济由技术内生化阶段向自主创新阶段转变,实现增长阶段的跨越。     

入境旅游对地区收入的影响

本文利用面板数据模型对不同地区的入境旅游消费支出与地区收入进行实证分析,结果发现,不同地区入境旅游的消费支出并没有显著差异,入境旅游的消费支出每提高1个百分点,国内主要城市的旅游收入平均只能提高0.09个百分点。不同区域的自发收入水平差距是最重要的影响因素,其中,旅游发展的自发收入以拉萨最高,其次是深圳和南京等城市;最低的城市为兰州,其次是西宁和成都等城市。本文认为提高旅游发展投资力度、规范旅游发展制度、进一步开发多元化旅游市场、扩大文化交流和加大海外旅游营销力度是提高我国入境旅游业的发展能力,缩小不同区域间的旅游发展差距的有利举措。     

Returns to women’s education using optimal IV selection

This paper investigates returns to women’s education by applying an optimal IV selection approach, post-Lasso IV estimation, which improves the first-stage predictive relationship between an endogenous regressor and instruments. Using the 2010 American Community Survey, we find that an extra year of education increases married women’s own income by $4,480 and spouse income by $8,822. Our findings indicate that 53% of the increase in women’s consumption by education is attributed to the marriage market, and thus, we conclude that the marriage market is the primary channel through which education improves women’s well-being. The results demonstrate the advantages of the post-Lasso approach: The resulting two-stage least squares estimator maintains efficiency without increasing finite sample bias and is less subject to the inconsistency problem when some instruments are invalid; This differs from the results using the instrument of birth quarters only, which is mostly applied in studies on returns to education.     

农村人力资本外溢与中国城乡居民收入差距关系的实证分析

笔者采用协整检验和误差修正模型,考察了中国农村人力资本外溢对城乡居民收入差距的影响。研究表明,农村人力资本的大规模外溢引起了城乡居民收入差距的扩大,而城乡居民收入差距的扩大又会导致农村人力资本的进一步外溢;由于农村人力资本外溢,农村劳动力转移并不是缩小城乡收入差距的充分条件。要缩小城乡收入差距,必须采取有效措施,为农村人力资本作用的充分发挥创造条件。