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1. Neighborhood Defenders: Participatory Politics and America’s Housing Crisis, Katherine Levine Einstein, David M. Glick and Maxwell Palmer

Author:
Mark Paul
Publication Date:
01-2021
Content Type:
Journal Article
Journal:
Political Science Quarterly
Institution:
Academy of Political Science
Abstract:
America is in the midst of a housing crisis. For millions of Americans, stable housing is simply out of reach. A full-time worker earning minimum wage cannot afford a two-bedroom apartment in any county in the United States. Twenty-one million households, nearly half of all renters, are rent-burdened, with rent claiming more than a quarter of their income. There are a number of contributing factors to the crisis, including pervasive economic inequality and the lack of rising wages over an entire generation for nonmanagerial workers, but many economists, political scientists, and housing experts point the finger at a lack of housing supply. Specifically, much ink has been spilled over the “not in my back yard” (NIMBY) phenomenon, whereby local residents support more housing in theory, just not in their own neighborhoods. But do local residents really have the power necessary to slow new and denser development in ways that curtail housing supply and contribute to rising house prices? In their timely and important book, Katherine Levine Einstein, David M. Glick, and Maxwell Palmer provide an excellent analysis of the political institutions that empower certain local residents to resist change in their neighborhoods. While the NIMBY sentiment is worthy of consideration regarding the housing crisis, without the right institutions, the movement would not have legs. Neighborhood Defenders provides an in-depth study of how institutions initially designed to democratize local zoning and development decisions have resulted in unintended consequences. Specifically, they document how participatory institutions that could, in theory, keep developers accountable to the people have instead backfired, leading to a shortage of housing supply and a precipitous rise in prices.
Topic:
Book Review, Political Science, Crisis Management, and Housing
Political Geography:
North America and United States of America

2. Comovement of Home Prices: A Conditional Copula Approach

Author:
Lei Hou, Wei Long, and Qi Li
Publication Date:
02-2020
Content Type:
Working Paper
Abstract:
Even though housing markets in different areas are relatively localized, regional home prices have become closely correlated and tend to be simultaneously affected by many national economic factors. In this paper, through the dynamic copula model, we confirm that regional home price dependence is time-varying and the conventional time-invariant copulas underestimate the degree of dependence during economic expansions and recessions. In essence, the U.S. residential real estate market has become more integrated since the mid-1980s. Using the conditional copula model, we further identify how the dependence among regional housing markets evolves along with some fundamental economic factors such as unemployment rate and interest rate. These findings can help investors and home buyers to better identify and evaluate the systematic risk in the nationwide housing market.
Topic:
Economics, Unemployment, and Housing
Political Geography:
China, Asia, North America, and United States of America

3. Strong Foundations: Financial Security Starts with Affordable, Stable Housing

Author:
Aspen Institute and EPIC
Publication Date:
01-2020
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
One in three US households—nearly 100 million people—struggle with housing costs that jeopardize their financial security. The problem is acute for virtually all low-income families and for the 1 in 4 renters who spend 50% or more of their income on housing—and its effects ripple throughout our communities and economy. In 2019, Aspen EPIC recognized rising housing costs and instability as critical threats to the financial security of American families and created a comprehensive research primer on the topic. Drawing on extensive review of the research literature, engagement with more than 100 experts, and analysis of federal survey data, we have prepared a research brief and primer, “Strong Foundations: Financial security starts with affordable, stable housing.”
Topic:
Security, Financial Stability, and Housing
Political Geography:
United States of America and North America

4. On Love and Metamorphosis

Author:
Meg Murphy
Publication Date:
04-2016
Content Type:
Working Paper
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
Andrea Ortiz went down to the Charles River on the afternoon that she—victoriously—submitted her senior thesis. There she was, a girl born in Mexico City, an immigrant raised in Miami, a bright light, the first in her family line to get to Harvard. Yet she felt a wave of sadness, and that, she reasoned, made no sense. So she sat by the river to think until it came to her: this was yearning. “You never accomplish anything alone. I was feeling the absence of the people who were most influential in getting me to this point,” she said later. “I wished they could be here too.” Her grandmother is one of those people. She is a woman who created her own philosophy and humanities class in Mexico City for people, like herself at the time, without access to a college education. Later in rural Comitán de Dominguez, where Ortiz spent childhood summers, her grandmother mail-ordered hundreds of books. The family home became an informal library for rural housewives.
Topic:
Poverty, Social Services, Community, and Housing
Political Geography:
United States and North America

5. How Did a Domestic Housing Slump Turn into a Global Financial Crisis?

Author:
Steven B. Kamin and Laurie Pounder DeMarco
Publication Date:
01-2010
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
The global financial crisis clearly started with problems in the U.S. subprime sector and spread across the world from there. But was the direct exposure of foreigners to the U.S. financial system a key driver of the crisis, or did other factors account for its rapid contagion across the world? To answer this question, we assessed whether countries that held large amounts of U.S. mortgage-backed securities (MBS) and were highly dependent on dollar funding experienced a greater degree of financial distress during the crisis. We found little evidence of such “direct contagion” from the United States to abroad. Although CDS spreads generally rose higher and bank stocks generally fell lower in countries with more exposure to U.S. MBS and greater dollar funding needs, these correlations were not robust, and they fail to explain the lion’s share of the deterioration in asset prices that took place during the crisis. Accordingly, channels of “indirect contagion” may have played a more important role in the global spread of the crisis: a generalized run on global financial institutions, given the opacity of their balance sheets; excessive dependence on short-term funding; vicious cycles of mark-to-market losses driving fire sales of MBS; the realization that financial firms around the world were pursuing similar (flawed) business models; and global swings in risk aversion. The U.S. subprime crisis, rather than being a fundamental driver of the global crisis, may have been merely a trigger for a global bank run and for disillusionment with a risky business model that already had spread around the world.
Topic:
Financial Crisis, Global Financial Crisis, and Housing
Political Geography:
United States and North America