The Unassuming Economist

On cross-country:

• Rising housing costs in the EU. Rising housing prices and rents are a big concern for many Europeans. – European Parliament
• Golden Passports and Visas: How Investment Migration Works – Council on Foreign Relations

Working papers and conferences:

• Event: 13th Annual Housing Center Conference on November 21 – AEI
• The housing consumption channel of mortgage demand – VoxEU
• Housing markets in Portugal and Spain: Fundamentals, overvaluation and shocks – Banco de Portugal
• Understanding Spatial House Price Dynamics in a Housing Boom – SSRN
• Prime Locations, Hidden Costs: Measuring the Impact of Amazon Distribution Centers on Housing Prices – SSRN 
• Do Housing Supply Skeptics Learn? Evidence from Economics and Advocacy Treatments – SSRN
• Monetary Policy and Racial Inequality in Housing Markets – SSRN
• The Racial Dynamics of U.S. Neighborhoods and Their Housing Prices from 1950 Through 1990 – SSRN

On the US—developments on house prices, rent, permits and mortgage:    

• Why Mortgage Rates Went Up After the Fed’s Big Cut. What’s the link between benchmark rates and home loans? – Bloomberg
• Mortgage Rates Surge, Putting a Damper on Home Buying and Refinancing – Realtor.com
• Redfin Reports Rising Mortgage Rates Haven’t Yet Slowed Pending Sales – Redfin 
• Mortgage rates were supposed to come down. Instead, they’re rising. Here’s why – NPR
• Mortgage Rates Rise to 6.44%, Yet ‘Buyers May Be Feeling Ready To Act’ – Realtor.com 
• Economic, Housing and Mortgage Market Outlook – October 2024 | Spotlight: First-Time Homebuyers – Freddie Mac
• Mortgage Lender Sentiment Survey – Fannie Mae
• Home Sales on Track for Worst Year Since 1995. September sales fell 3.5% from a year earlier. In 2023, home sales hit their lowest point in 30 years. – Wall Street Journal
• 3rd Look at Local Housing Markets in September – Calculated Risk
• Housing Starts Decreased to 1.354 million Annual Rate in September – Calculated Risk
• Single-Family Starts Trend Higher in September – NAHB
• Housing market shift: 6 major markets where home prices are actually falling. Some regional housing markets in states, such as Texas, Florida, and Louisiana, are experiencing mild home price corrections. – Fast Company
• America Is Primed for a Home-Renovation Resurgence. Falling interest rates are expected to make it easier to pay for big home-improvement projects – Wall Street Journal 
• NAR: Existing-Home Sales Decreased to 3.84 million SAAR in September, New Cycle Low. Median House Prices Increased 3.0% Year-over-Year – Calculated Risk
• Existing Home Sales Fall to 14-Year Low in September – NAHB
• The Multifamily Housing Conundrum – Atlanta Fed 

On the US—other developments:    

• How the next president can solve America’s housing crisis – Agglomerations
• Housing costs are rising everywhere — but especially in swing states. America’s housing affordability crisis is weighing heavily on the nation’s most sought-after voters in places like Wilmington, N.C., where home prices have risen 65 percent since 2019. – Washington Post
• As Harris Courts Sun Belt, Housing Costs Stand in Her Way. Shuttered factories and trade deals helped turn working-class Midwesterners against Democrats. Will the high cost of housing do the same in the Sun Belt? – New York Times
• Can Million-Dollar Apartments Solve California’s Housing Crisis? – Cato  
• Where do the estimates of a “housing shortage” come from? – Brookings
• High Prices, Low Supply: Three Swing State Cities Show the Housing Crunch. Middle-class housing pain is especially acute in Las Vegas, Philadelphia and Atlanta areas – Bloomberg
• POLITICO’s Affordable Housing: The New Agenda – Politico   
• Down Payments Are Dropping From Historic Highs—See How Much Homebuyers Can Save Today – Realtor.com
• California’s Unaffordable Housing Plans. Ballot measures would let localities impose rent control and evade property-tax limits. – Wall Street Journal
• California Home Sales Up 5% SA YoY in September – Calculated Risk
• How Developers Are Catering to Would-Be Homeowners With Rental Amenities. Families are choosing to rent for the foreseeable future  — some out of necessity, others for amenities. – New York Times
• Housing Cost Burdens Across Congressional Districts – NAHB
• Home Equity Gains Level Off as U.S. Housing Market Cools Down During Third Quarter of 2024 – ATTOM

On China:

• China Home Price Slump Drags On Despite Revival Efforts – Bloomberg
• China Ramps up Spending on Housing Projects to $562bn. Minister vows to expand its “white list” of housing projects for priority funding, while banks boost lending for developments to 4 trillion yuan ($562 billion) by year-end – Asia Financial
• China will win ‘tough battle’ to preserve property sector: housing minister. China’s housing ministry unveiled its plan to support the country’s property sector, with an expansion of funding to 4 trillion yuan – South China Morning Post
• China’s home prices see biggest drop in 9 years despite efforts to revive market. New home prices in September fell 6.1 per cent year on year in 70 mainland cities, widening from a 5.7 per cent slump in August – South China Morning Post
• China cuts mortgage rate in ‘encouraging sign’, but heavy lifting still needed. Five-year loan prime rate lowered from 3.85 per cent to 3.6 per cent, the People’s Bank of China said on Monday – South China Morning Post

On Australia and New Zealand

• [Australia] Making sense of housing policy proposals – CoreLogic
• [Australia] Why does big business want Australia to spend billions on not building houses? Housing developers have a keen financial interest in drip-feeding new homes into the market to maximise their returns – The Guardian
• [Australia] Australia is getting serious about the housing crisis. Young people, parents and grandparents should all have a stake in fixing arguably Australia’s No.1 economic and social challenge. – Financial Review

On other countries:  

• [Canada] ‘In the Red Pretty Deep’: Canadian Housing Investors Try to Sell to Stanch Losses. Outlook ‘not great’ for housing investors, RBC economist says. Rental rates have flatlined recently as immigration slows – Bloomberg
• [Malaysia] In a Malaysian Pop-Up City, Echoes of China’s Housing Crash. Forest City was an audacious $100 billion project by a top Chinese developer. Today, the project is a fraction of what had been planned and the developer is broke. – New York Times
• [United Kingdom] UK Housing Crisis Has a Back-to-the-Future Fix. New towns are the forgotten half of a social contract that helped to transform living conditions after the war. Labour’s plan to revive them is overdue. – Bloomberg

From a paper by Fahmida Mostafiz:

“This paper explores the connection between industrial policy and New Structural Economics (NSE) from the perspective of a transitioning economy. The NSE emphasizes that by leveraging comparative advantages, investing in infrastructure and human capital, diversifying the industrial base, and enacting institutional reforms, transitioning economies can achieve sustainable economic development. For industrial policy to be effective, it must align with these principles. Using Bangladesh as a case study, this paper proposes a theoretical framework that links industrial policy with NSE to foster sustainable economic growth. The framework emphasizes the critical role of government intervention in resource allocation, benefit distribution, and industrial growth, all of which are driven by targeted industrial policies. Additionally, it categorizes Bangladesh’s industries into five groups, prioritizing leading-edge sectors focused on technological advancement and skill development over catching-up industries that address productivity gaps. This paper contributes to the understanding of Bangladesh’s industrial policy through the lens of NSE, shedding light on the underlying dynamics that shape the country’s industrial structure, competitiveness, and future economic trajectory.”

From a paper by Jeisson Riveros and Muhammad Shahbaz:

“Nowadays, nobody can deny the relationship between economic growth and sustainability; however, the tendency to un-match a linear relationship between those two has acquired the name of “decoupling” economy, which means that the consumption of energy not necessarily has to rise at the same rate of gross domestic product, in order to reduce carbon emissions in a country or certain area. Then this document aims to study the Colombian decoupling, analyzing the economic structure and energy consumption between 1975 to 2021, applying the TAPIO model and the logarithmic mean Divisa index (LMDI) using the KAYA identity as a conversion factor (TAPIO+KAYA+LMDI) to analyze the trends per economical sector. Finding that, the Colombian economy has a predominant status of weak decoupling with randomly switches to strong decoupling, positioning it as a sustainable economy; although this condition is environmentally favorable, under a comprehensive public policy, energy consumption by economic sector can be increased to improve economic productivity and achieve better production levels on the sectors of agriculture, mines, and commerce whose energy consumption according to the data is substantially low.”

From a paper by Abdisalan Aden Mohamed:

“This paper aims to empirically examine the relationship between GDP and unemployment in Somalia from 2000 to 2021. The study also estimates Okun’s coefficient. To evaluate the association between the unemployment rate and economic growth, we employ the Hodrick–Prescott (HP) filter detrending technique, the Augmented Dickey–Fuller (ADF) test, ordinary least squares (OLS), and fully modified OLS. The findings of this study demonstrate that the series is stationary at the level. However, the results confirm a statistically insignificant negative relationship between unemployment and economic growth. Consequently, our findings suggest that Okun’s law does not apply in Somalia. For robustness, we employ fully modified ordinary least squares (FMOLS), canonical cointegrating regression (CCR), and dynamic ordinary least squares (DOLS). Nevertheless, the relationship between the GDP gap and unemployment is not strong enough to be considered statistically significant, and other factors may also influence unemployment. Therefore, policies aimed at reducing unemployment should take into account various factors, including education and training, labor market regulations, and social protection measures.”

From reddytoread:

“When I first encountered the ideas central to the winners of this year’s three Nobel Prize in Economics[2] around two and a half decades ago I was startled. The excessive economy of their framework for understanding a complex global reality combined with a set of premises that looked starkly ideological. Despite the time that has passed, the reams that have been written, and the imprimatur these ideas have now received, these charges remain pertinent.

The point of view of the authors remains narrowly focused – even fixated – on property rights, seeing them as defining inclusive economic institutions[3] and as underpinning inclusive political institutions[4], the coupled concepts at the center of their understanding of Why Nations Fail, the sizable volume in which two of the authors elaborated and extended their view.[5] It is understandable that this perspective enjoys a resonance among property holders and enthusiasts, both in the economic discipline and more broadly in society, as it is reflection of a common sense that prevails in such quarters, but it provides an inadequate guide to understanding either democracy or development. This is because property rights play more diverse and ambivalent roles in both phenomena than they acknowledge. Their view is ahistorical. It misses essential aspects of the colonial experience (such as the impact of ethnic and racial prejudices and solidarities based on the global color line) and its resulting legacies. It also misunderstands the sources of success of rising nations in the contemporary world, such as the role of developmental states.

I had been interested in political economy, and in particular the role of institutions, as a way of understanding the economics of development – and the world at large – more deeply, throughout my student years.  As did many others, I had drunk deeply at the well of available knowledge, ingesting tracts on social conflict as it affects inflation and other economic outcomes, about how states are captured by particular interests, the economic causes and consequences of colonialism and imperialism, the role of norms, customs and conflict in shaping the use of shared resources, the political and social underpinnings of economic innovation, and many other topics. The enormous range of writings on institutions and economic life was by economic and social historians, political scientists, sociologists, anthropologists, legal scholars and some economists too, especially those writing outside of the mainstream (running a gamut from the leftist French “regulation school” to the libertarian Virginia school of political economy). It was not unwelcome that well-positioned mainstream economists, sitting at the institutional apex of the discipline, would be interested in these topics, but what was one to make of their reductionistic approach? Many of the writings I had digested did have the unhelpful view that ‘It is complicated’ and a simple framework that cut through the fog would have its appeal – but could such a perspective in fact be offered while respecting facts about the world?”

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