Curriculum Vitae



Isaac Hacamo

Haas School of Business

University of California at Berkeley

545 Student Services Bldg., #1900

Berkeley, CA 94720-1900


Research Interests

Household Finance, Financial Intermediation, Corporate Finance, Macroeconomics, Labor Economics

Teaching Awards

Earl F. Cheit GSI Award for Excellence in Teaching, Full-time MBA Program, 2012 (weblink)

Earl F. Cheit GSI Award for Excellence in Teaching, MFE Program, 2012 (weblink)

UC Berkeley Outstanding Graduate Student Instructor, Undergraduate Program, 2011 (weblink)

Job Market Paper

1. Finance and Welfare: The Effect of Access to Credit on Family Structure, Jan 2013.

There is a large debate over the welfare effects of the early 2000s housing boom and bust. One potentially important welfare effect is the impact of mortgage credit expansion on family structure. Exploiting pre-housing boom variation on the distribution of old homeowners who live alone and are older than 65, I conduct within-county analysis with zip code level data to causally identify the effect of access to credit on fertility outcomes through a channel associated with a more efficient reallocation of the existing housing stock among households. I examine two other housing channels, house wealth gains and new construction, and show that the most relevant channel is the reallocation, which allows young households to access space by either moving to larger homes or achieving homeownership earlier in their life-cycle. A one standard deviation increase in reallocation leads to a 6.4% increase in fertility from 2000 to 2006. The same increase in house prices leads to only a 2.7% increase, and in new construction leads to a 1.5% decline. I estimate that approximately 500,000 babies were born between 2000 and 2006 because of the reallocation channel.

Working Papers and Work in Progress

2. Wealth Inequality: How Much House Wealth Investors Extracted from Households after the Financial Crisis? (In Progress)

Five years after the beginning of the 2008 financial crisis, the Federal Reserve announced that households’ net worth rose to $74.8 trillion, a $17.6 trillion raise from the bottom level in 2008. Home and stock prices have risen since 2008, suggesting full recovery of households’ net worth. However, after the recession, the gains in wealth were not evenly distributed because homeownership declined after the housing bust, in particular among lower-income households. Using a dataset of approximately 6 million transactions in the 20 largest MSAs from 2008 to 2013  - where I can track in each transaction the buyer and seller’s name, the selling price, and the house address and characteristics - I estimate how much house wealth was transferred from households to investors after the housing bust. In the data, I observe that investors either purchase houses in the market at a discount or in foreclosure auctions. Subsequently, investors either sell the properties shortly after the purchase, presumably because the discount is large enough, or hold to the properties, renting them out until prices rise to their reservation values - to estimate rent prices at the micro level, I collected 35 million craigslist ads from 2008 to 2013. By focusing on houses purchased in foreclosure auctions and accounting for foreclosures damage costs, my first results show that investors benefited from abnormal discounts relative to market prices. Moreover, on average investors realized their returns in less than 6 months after purchasing the house in the auction.

3. Job Polarization and Access to Credit (In Progress)

Over recent decades, the U.S. workforce has undergone a dramatic restructuring in response to changes in technology. Low and high skill jobs have expanded, while middle skill jobs, such as manufacturing, have contracted (Autor, Katz and Kearney 2006). This secular change in the U.S. labor market affects worker’s income risk in various occupations and presumably their access to credit markets (Stiglitz and Weiss 1981). Using the longitudinal panel of income by occupation from the PSID dataset and the decennial census data on the distribution of occupations by zip code, I estimate, for 1990 and 2000, the variance of permanent and transitory income by occupation at the zip code level. I then show, after accounting for variations in unemployment and income, that during the 1990s denial rates for mortgage credit were significantly higher in zip codes where the variance of permanent and transitory income was higher. My evidence suggests that lenders increased credit rationing for workers in occupations that were most affected by the job polarization, namely the middle skill occupations.

4. Negativity Bias in Attention Allocation: Retail Investors Reaction to Stock Returns, (with Tomas Reyes), 2012.

We argue that negative stock market performance attracts more attention from retail investors than comparable positive performance. Specifically, we test and confirm the hypothesis that retail investors pay more attention to negative than positive extreme returns. We present a measure of attention at the aggregate and company specific level using internet search volume from Google. These measures correlate with, but are different from, existing proxies of attention. Our empirical results strongly support that investors display a negativity bias in attention allocation with respect to extreme stock returns. Across all specifications, lagged negative extreme returns are stronger predictors, than positive extreme returns, of high attention at the stock and market level. We rule out that negative returns are stronger simply because they are more unusual or because negative and positive returns are not symmetrical events to stockholders.