Search Results
Working Paper
National and Regional Housing Vacancy: Insights Using Markov-switching Models
We examine homeowner vacancy rates over time and space using Markov-switching models. Our theoretical analysis extends the Wheaton (1990) search and matching model for housing by incorporating regime-switching behavior and interregional spillovers. Our approach is strongly supported by our empirical results. Estimations, using constant-only as well as Vector Autoregressions, allow us to examine differences in vacancy rates as well as explore the possibility of asymmetries within and across housing markets, depending on the state/regime (e.g., low or high vacancy) of a given housing market. ...
Working Paper
House Price Growth Interdependencies and Comovement
This paper examines house price diffusion across metropolitan areas in the United States. We develop a generalization of the Hamilton and Owyang (2012) Markov-switching model, where we incorporate direct regional spillovers using a spatial weighting matrix. The Markov-switching framework allows consideration for house price movements that occur due to similar timing of downturns across MSAs. The inclusion of the spatial weighting matrix improves fit compared to a standard endogenous clustering model. We find seven clusters of MSAs that experience idiosyncratic recessions plus one distinct ...
Journal Article
How Might Transforming Highways Impact Community Wealth?
Cities are rethinking what the highway system might look like. How might changes impact wealth, and how might a history of racial inequities be addressed?
Working Paper
Airport-related noise, proximity, and housing prices in Atlanta
Using hedonic models, we analyze the effects of noise and proximity on housing prices in neighborhoods near Hartsfield-Jackson Atlanta International Airport during 1995-2002. We address complications caused by changes over time in the levels and geographic distribution of noise and by the fact that noise levels are measured only at the beginning and after the end of the sample period. Generally speaking, housing prices were affected positively by declining noise levels. After accounting for proximity, house characteristics, and demographic variables, houses in noisier areas sold for less than ...
Working Paper
Spatial hedonic models of airport noise, proximity, and housing prices
Despite the refrain that housing prices are determined by "location, location, and location," no prior studies of airport noise and housing prices have incorporated spatial econometric techniques. We compare various spatial econometric models and estimation methods in a hedonic price framework to examine the impact of noise on 2003 housing values near the Atlanta airport. Spatial effects are best captured by a model including both spatial autocorrelation and autoregressive parameters estimated by a generalized moments approach. The inclusion of spatial effects magnifies the negative price ...
Working Paper
Spatial heterogeneity and the geographic distribution of airport noise
One might expect that houses closer to an airport and those in higher minority population neighborhoods experience more airport noise. We find evidence supporting these conjectures when estimating a standard ordered probit model for houses sold near the Atlanta airport. However, because the various neighborhood demographics surrounding the airport can be heterogeneous, and the noise contours are not necessarily correlated with distance in certain neighborhoods, we hypothesize that the impacts of explanatory variables on the probability of greater noise vary across space. We explore spatial ...
Working Paper
Aviation security and terrorism: a review of the economic issues
Following the terrorist attacks on September 11, 2001, the passage of the Aviation and Transportation Act mandated a substantial increase in resources devoted to aviation security. This paper summarizes the specific changes stemming from this legislation. In addition, the paper examines the economic issues underlying the regulation and provision of aviation security. The fact that security at one airport can affect the well being of those at other airports and elsewhere, an example of a network externality (spillover), provides an economic justification for governmental involvement in ...
Working Paper
Semi-Parametric Interpolations of Residential Location Values: Using Housing Price Data to Generate Balanced Panels
We estimate location values for single family houses by local polynomial regressions (LPR), a semi-parametric procedure, using a standard housing price and characteristics dataset. As a logical extension of the LPR method, we interpolate land values for every property in every year and validate the accuracy of the interpolated estimates with an out-of-sample forecasting approach using Denver sales during 2003 through 2010. We also compare the LPR and OLS models out-of-sample and determine that the LPR model is more efficient at predicting location values. In a balanced panel application, we ...
Working Paper
Local Polynomial Regressions versus OLS for Generating Location Value Estimates: Which is More Efficient in Out-of-Sample Forecasts?
As an alternative to ordinary least squares (OLS), we estimate location values for single family houses using a standard housing price and characteristics dataset by local polynomial regressions (LPR), a semi-parametric procedure. We also compare the LPR and OLS models in the Denver metropolitan area in the years 2003, 2006 and 2010 with out-of-sample forecasting. We determine that the LPR model is more efficient than OLS at predicting location values in counties with greater densities of sales. Also, LPR outperforms OLS in 2010 for all 5 counties in our dataset. Our findings suggest that LPR ...
Journal Article
Auctions as a vehicle to reduce airport delays and achieve value capture
Congestion at airports imposes large costs on airlines and their passengers. A key reason for congestion is that an airline schedules its flights without regard to the costs imposed on other airlines and their passengers. As a result, during some time intervals, airlines schedule more flights to and from an airport than that airport can accommodate and flights are delayed. This paper explores how a specific market-based proposal by the Federal Aviation Administration (FAA), which includes the use of auctions to determine the right to arrive or depart in a specific time interval at airports in ...