The Unassuming Economist

From a paper by M. Shabri Abd. Majid, F. Faisal, Heru Fahlevi, Maulidar Agustina, A. Azhari, Y. Yahya & Z. Zulkifli:

“Micro, small, and medium enterprises (MSMEs) are widely recognized as key drivers of entrepreneurship and inclusive growth; however, their effectiveness in reducing poverty depends more on the quality of productivity improvements than on the expansion of firm numbers alone. This study investigates how entrepreneurial productivity, measured by total factor productivity (TFP) and its components—efficiency change and technological progress—affects poverty both directly and through the sequential roles of human development (HDI) and economic growth. Using 2,070 panel observations from six sectors across 23 districts in Aceh, Indonesia (2010–2024), productivity is estimated through the Malmquist Index within a Data Envelopment Analysis (DEA) framework. Direct, single, and sequential mediation effects are examined using the Baron and Kenny approach and estimated via Estimated Generalized Least Squares (EGLS) with Seemingly Unrelated Regression (SUR) adjustments. The findings reveal heterogeneous effects across productivity components, highlighting asymmetric transmission mechanisms in which different dimensions of productivity influence poverty through distinct pathways. Increases in TFP and technological progress are associated with reductions in poverty (β ≈ 0.135–0.311), whereas efficiency change is linked to higher poverty levels (β ≈ − 0.117 to − 0.226), reflecting short-term adjustment costs from structural changes. Economic growth emerges as the primary transmission channel, while HDI does not exert a direct effect but significantly strengthens the impact of productivity when it precedes growth in the causal sequence. The strongest poverty reduction occurs when productivity first improves human development and subsequently stimulates economic expansion. Technological progress exhibits mixed effects depending on the mediation pathway, indicating uneven distributional outcomes. Overall, the results suggest that productivity gains do not automatically lead to inclusive welfare improvements. Policy efforts should therefore prioritize innovation-driven and stable productivity growth while mitigating the adverse social effects of abrupt efficiency adjustments. This study contributes by demonstrating that different dimensions of entrepreneurial productivity generate distinct development outcomes and by proposing a sequential mediation framework that explains why some productivity gains alleviate poverty while others intensify it.”

On cross-country:

• New Taxes Helped Cool London’s Housing Market. Could That Happen in New York? Economists and real estate agents are calling London’s taxation of wealthy property owners a cautionary tale for New York, where leaders have endorsed a second-home tax. – New York Times

Working papers and conferences:

• The Regional and Demographic Profile of Housing Affordability: Evidence from Greek Households – CEPR
• Housing Wealth Accumulation and Electoral Representation – University of California – San Diego
• Market Power in Mortgage Pricing: the Role of Referral Lending – NBER
• Price and Prejudice: Preferences and Incentives in the Dynamics of Racial Residential Segregation – CEPR
• Upgrading housing – the potential and limits of borrower-based measures – SUERF
• Housing Supply and Racial Integration: Evidence from Building Permits in U.S. Metropolitan Areas – OSF
• The Impact of the Comprehensive Real Estate Holding Tax on Asset Equity and the Housing Market – Journal of Housing Economics  

On Australia and New Zealand:

• [Australia] Why Australian property prices could go backwards by 2030 – The Sydney Morning Herald

On other countries:  

• [Canada] Canada’s deflating housing bubble stymies wealth effect of booming stock market – Reuters
• [Mexico] Mexico City seeks new rent controls. Shortage of affordable homes and protests over US immigrants prompt policy response – FT
• [United Kingdom] The Guardian view on help to buy: entrenching housing inequalities, rather than helping. The Tories’ flagship scheme has aided higher earners most. The latest analysis of its flaws should lead to a rethink – The Guardian
• [United Kingdom] New Taxes Helped Cool London’s Housing Market. Could That Happen in New York? Economists and real estate agents are calling London’s taxation of wealthy property owners a cautionary tale for New York, where leaders have endorsed a second-home tax. – New York Times
• [United Kingdom] The problem with falling house prices. Homes are too expensive in the UK, but a large correction would be bad for everyone — including first-time buyers – FT

On prices, rent, and mortgage:    

• The Credit Bubble Everybody’s Ignoring. Federally backed student loans and mortgages are seeing increased defaults. Taxpayers are on the hook. – Wall Street Journal
• Reform the Federal Home Loan Banks to finance the housing America needs – Brookings
• The housing “bubble” in the late 2000s looks quaint by comparison now – Alec Stapp
• AEI National Home Price Appreciation (HPA) Index: March 2026 – AEI 
• Event: Vanishing Tax Credits and a Shrinking Market: Who Can Afford to Rent? – Chicago Fed
• Freddie Mac House Price Index Decreased in March; Up only 0.7% Year-over-year. Punta Gorda House Prices Down 21% from Recent Peak, Austin Down 18% – Calculated Risk

On sales, permits, starts, and supply:    

• Final Look at Local Housing Markets in March and a Look Ahead to April Sales – Calculated Risk
• When’s the Best Time to Buy a Home? It depends on whether you prioritize selection or price – Home Economics
• A Bill Aimed at Creating Homes Is Leaving Plots Empty Instead. The Senate housing bill would severely restrict build-to-rent homes. It is already causing projects to pause and financing to dry up. – Wall Street Journal
• Housing Starts Increased to 1.502 million Annual Rate in March – Calculated Risk
• Home Building Shows Signs of Stabilization with Monthly Gain in Starts – NAHB
• A strong month in a fragile market. March data shows momentum, but a build-to-rent crackdown and tighter capital markets threaten to stall future supply – Slow Boring
• Federal Threats on the Horizon Are Killing Housing Supply Growth Now – Cato  
• Why Texas Is Winning the Housing War. Rents are falling in Texas — and the reason is simpler than you think. Derek Thompson, a contributing writer at The Atlantic, tells the Opinion columnist Ezra Klein how Dallas and Austin have shown that the only real cure for a housing crisis is an aggressive, unrelenting surge in supply. – New York Times
• U.S. Housing Starts Rose in March. For February, housing starts fell – Wall Street Journal

On other developments:    

• A troubling plan to revive the frozen US property market. Buyers should beware the real estate dark pools – FT
• Bipartisan House coalition pressures leaders on housing bill. 76 House lawmakers warn investor limits in Senate housing bill could curb supply, squeeze renters and derail affordability push. – Politico
• Congress May Finally Recognize That Mobile Homes Aren’t Really That Mobile. An obscure federal rule requires manufactured homes to be built on a chassis, making them more costly. A bill in Congress would remove the mandate, enacted five decades ago. – New York Times
• Nearly 4 in 5 Americans Don’t Feel Their Financial Future Is Secure. Owning a Home Could Be the Fix – NBER
• Event: Housing Abundance, Where Jobs Sleep, and Good Neighbors Market Intelligence – AEI
• Government Benefits Reduce Housing Cost Burdens – Harvard Joint Center for Housing Studies
• Aging Homeowners Poised to Reshape Housing Market in Key Cities – Realtor.com
• Homeownership Rate Ticks Down in Early 2026 – Realtor.com
• This Isn’t Your Grandpa’s Housing Market. Are you mad your iPhone costs more than a flip-phone? Then you shouldn’t be so frustrated with home prices either. – Wall Street Journal
• How the War in Iran Is Hurting the U.S. Housing Market. Buyers across the country are cautious, while the Miami market seems immune. – New York Times

From a VoxEU post by Pablo García Guzmán, Anton Grahed, Beata Javorcik, and Helena Schweiger:

“The pursuit of export-led growth through manufacturing has become increasingly difficult in the face of growing global competition. A shift towards service export-led growth offers new opportunities, but it also demands investments in human capital, infrastructure, and institutional capacity. This second column in a three-part series explores the emerging service export model, its potential for growth, and the policy strategies needed for countries in the EBRD regions to successfully navigate this transition.”

From a paper by Davide Furceri, Georgios Karras, and Khatereh Yarveisi:

“We use the World Uncertainty Index (WUI) to estimate the dynamic effects of uncertainty on the current account balance for a large sample of 143 developed and developing countries, during the period 1973–2021. Our analysis shows that higher uncertainty is associated with an increase in the current account balance which reflects both increased saving and reduced investment. These effects are sizable and statistically significant, peaking one year after the uncertainty shock, and gradually dying out in the long run. The effect varies across countries, being larger in countries characterized by lower social expenditure, less developed financial markets, and during periods of high financial stress.”