House Prices, Home Equity and Entrepreneurship: Evidence f rom U.S. Census Micro Data" with Sari Pekkala Kerr (W ellesley College) and William R. Kerr (Harvard Business School)
< p>Abstract:We use Census Bureau micro data to shed new light on the relationship between home values and US entrepreneurship during the house price run-up of the early 2000s. In isol ating the causal effect of higher collateral on entrepreneurship, we estima te that a 10% increase in house prices led to a 0.6% increase in entreprene urship over this period. We show that the primary mechanism through which t he collateral channel operated was through the deleveraging of home owners who would not have had borrowing capacity absent the price run-ups. Only a modest number of households were sufficiently leveraged for this to have a meaningful aggregate impact on entrepreneurship, however, which explains th e relatively weaker aggregate role for the collateral channel in entreprene urship compared to the more widespread impact of increased home equity on h ousehold consumption over this period.
DTSTAMP:20260702T055112Z DTSTART:20210401T170000Z DTEND:20210401T180000Z SEQUENCE:0 TRANSP:OPAQUE END:VEVENT END:VCALENDAR