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The Effects Of The Housing Crisis On Labor Mobility And Unemployment, Kevin Bergy
The Effects Of The Housing Crisis On Labor Mobility And Unemployment, Kevin Bergy
Honors Projects
The recent housing crisis has had drastic effects on the labor market. Falling home values have forced some homeowners to remain in their homes for financial reasons even when a move is desired because they are locked-in. When labor cannot move freely from place to place, employment is affected. The greater the lock-in effect, the more negative the labor market externalities. In this paper, the relationship among homeownership, labor mobility, and unemployment is examined. The lock-in effect, nominal loss aversion, and Oswald’s hypothesis will all be applied to the recent housing crisis in an effort to show the drastic economic …