JOB MARKET PAPER

The Choice to Rent or Own: Why Rents and Mortgages Rates Are Jointly Determined

DOCTORAL COMMITTEE

Nancy Wallace, Committee Chair.
Phone: (+1) 510-642-4732.
Email: wallace@haas.berkeley.edu

Dwight Jaffee, Committee Co-Chair.
Phone: (+1) 510-642-1273.
Email: jaffee@haas.berkeley.edu

Robert M. Anderson, Committee Member.
Phone: (+1) 510-642-5248.
Email: anderson@econ.berkeley.edu

Richard H. Stanton, Committee Member.
Phone: (+1) 510-642-7382.
Email: stanton@haas.berkeley.edu

RESEARCH INTERESTS

For most people, embarking upon home ownership means more than a sudden need for a lawn mower: It means a mortgage contract—and serious constraints on the ability to react to financial shockwaves such as unemployment or stock market downturns. I am intrigued by “how the presence of a mortgage contract and the associated probability of default can affect and constrain a household’s consumption and portfolio choices”. The combination of house and mortgage can impose a sort of rigidity that makes risk extremely costly for many households.

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