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On the Negative Relationship between Labour Income Uncertainty and Homeownership:Risk aversion vs Credit Constraints.

Diaz-Serrano, Mr. Luis (2005) On the Negative Relationship between Labour Income Uncertainty and Homeownership:Risk aversion vs Credit Constraints. UNSPECIFIED. (Unpublished)

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Abstract

In this paper we test for the first time whether the driving force behind the negative effect of income uncertainty on owner-occupancy propensities is risk aversion or credit constraints. To desentangle this puzzle we estimate reduced form equations using Italian data. Consistent with the previous empirical evidence in the US. our results cofirm that in Italy both labor income uncertainty and credit constraints exert a significant negative effect on the probability of homeownership. However, our main findings indicate that the negative relationship between labor income uncertainty and homeownership is driven by households' risk aversion.

Item Type: Other
Additional Information: JEL Classification: D1, Ro, Jo N146/01/05 Dept. Of Economics Working Paper series
Keywords: Homeownership, income uncertainty, credit constraints, Risk aversion
Subjects: Social Sciences > Economics, Finance & Accounting
Item ID: 194
Depositing User: Ms Sandra Doherty
Date Deposited: 31 Jan 2005
Refereed: No
URI:

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