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Identification and estimation of spatial dynamic panel simultaneous equations models
Publication date: Available online 27 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Kai Yang, Lung-fei LeeAbstractThis paper investigates the identification and estimation of spatial dynamic panel simultaneous equations models with simultaneous effects, spatial effects, and time lagged effects. The model in this paper explicitly models interactions among different economic variables with simultaneous effects. Spatial interactions are presented by spatial weight matrices and, in addition to dynamics in space and time, we allow both individual and time fixed effects. For estimation, we study asymptotic prop...
Source: Regional Science and Urban Economics - July 28, 2018 Category: Science Source Type: research

Cooperative pricing in spatially differentiated markets
Publication date: Available online 27 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Matthias Firgo, Agnes KüglerAbstractThe empirical literature on mergers, market power and cooperation in differentiated markets has mainly focused on methods relying on output and/or panel data. In contrast to this literature we propose an approach to analyze cooperative behavior among a group of firms only by making use of information on the spatial structure of a horizontally differentiated market. Using spatial econometrics techniques we focus on differences in the pricing behavior between different groups of firms, i....
Source: Regional Science and Urban Economics - July 27, 2018 Category: Science Source Type: research

Spillover effects in home mortgage defaults: Identifying the power neighbor
Publication date: Available online 27 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Souphala Chomsisengphet, Hua Kiefer, Xiaodong LiuAbstractThis paper investigates spillover effects of mortgage defaults in the neighborhood on a homeowner's default decision. Following the interactions-based model of discrete choices in Lee et al. (2014), we explicitly model a homeowner's default decision as a function of predetermined risk factors as well as rational expectations on her neighbors' default decisions and find strong empirical evidence of spillover effects — in forms of time-lagged “contagion effects” ...
Source: Regional Science and Urban Economics - July 27, 2018 Category: Science Source Type: research

The Wealth Building Home Loan
Publication date: Available online 26 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Stephen D. Oliner, Tobias Peter, Edward J. PintoAbstractThe Wealth Building Home Loan (WBHL) represents a class of shorter-maturity mortgages that provide a low-risk path to homeownership and wealth accumulation while maximizing buying power. WBHLs are easy-to-understand loans that combine standard mortgage features in a novel way. Importantly, they require little or no downpayment. The WBHLs in the market today are 15- and 20-year loans, some with fixed rates and others structured as adjustable-rate mortgages (ARMs). We s...
Source: Regional Science and Urban Economics - July 27, 2018 Category: Science Source Type: research

Tax competition and the implications of national tax policy coordination in the presence of fiscal federalism
Publication date: Available online 25 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Benjamin Florian SiggelkowAbstractWe consider symmetric two-tier tax competition between leviathans, and tax policy coordination of national governments through merging at the upper tier. We show that, if sufficiently few governments merge, some common implications from the literature on single-tier tax competition no longer apply. First, we find that a merger party earns more tax revenue than a non-merger party. Second, given that the merged jurisdictions are regarded as the national government of a larger country, we est...
Source: Regional Science and Urban Economics - July 25, 2018 Category: Science Source Type: research

Editorial Board
Publication date: July 2018Source: Regional Science and Urban Economics, Volume 71Author(s): (Source: Regional Science and Urban Economics)
Source: Regional Science and Urban Economics - July 24, 2018 Category: Science Source Type: research

Spatial interactive effects on housing prices in Shanghai and Beijing
Publication date: Available online 23 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Juncong Guo, Xi QuAbstractWhen connected through economic, financial, and policy shocks, cities can be considered to be neighbors in the social-economic sense. Therefore, a spatial correlation may exist in cities that are not geographically contiguous. The paper simultaneously studies the spatial correlation within each city and the spatial interactive effects among different cities on housing prices. We build a spatial autoregressive hedonic pricing model in a system of interrelated networks, which allows for multiple spa...
Source: Regional Science and Urban Economics - July 24, 2018 Category: Science Source Type: research

Tobit models with social interactions: Complete vs incomplete information
Publication date: Available online 23 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Chao Yang, Lung-fei Lee, Xi QuAbstractIn many network data sets, the outcomes of interest are equal to zero for some agents and strictly positive for others. They can be analyzed by Tobit models with social interactions with different assumptions on information structures. Under complete information, all the observables and unobservables are publicly known. Under incomplete information, unobservables and some covariates collected by econometricians can be private information for agents. In practice, both scenarios can be f...
Source: Regional Science and Urban Economics - July 24, 2018 Category: Science Source Type: research

Overview and proposed reforms of the low-income housing tax credit program
Publication date: Available online 21 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Michael D. Eriksen, Bree J. Lang (Source: Regional Science and Urban Economics)
Source: Regional Science and Urban Economics - July 21, 2018 Category: Science Source Type: research

Regional labor markets, commuting, and the economic impact of road pricing
Publication date: Available online 19 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Toon Vandyck, Thomas F. RutherfordAbstractCities provide the benefits that come with economic density but often face congested traffic and high unemployment. In this paper, we study economy-wide and distributional implications of congestion pricing in the presence of agglomeration externalities and unemployment. We develop a spatial general equilibrium model to show that indirect effects of time-invariant congestion tolls can lead to welfare losses for low-skilled urban residents by changing commuting patterns of high-skil...
Source: Regional Science and Urban Economics - July 19, 2018 Category: Science Source Type: research

Mortgage recourse provisions and housing prices
Publication date: Available online 18 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Robert R. Reed, Amanda LaRue, Ejindu S. UmeAbstractIn light of the large swings in housing prices in the United States in recent years, there has been considerable interest in trying to understand the various factors which led to the boom and bust of the housing market. In this paper, we explore the impact of the legal environment from provisions for mortgage default across U.S. states. To do so, we develop a rigorous framework with microeconomic foundations for financial intermediaries. To be specific, we introduce a hous...
Source: Regional Science and Urban Economics - July 19, 2018 Category: Science Source Type: research

What do we know about housing choice vouchers?
Publication date: Available online 10 July 2018Source: Regional Science and Urban EconomicsAuthor(s): Ingrid Gould ElleAbstractThe Housing Choice Voucher Program provides assistance to approximately 2.2 million households each year, making it the largest low-income housing subsidy program managed by the U.S. Department of Housing and Urban Development (HUD). This paper reviews what we know about the program. In brief, experimental research shows that vouchers help to reduce the rent burdens of low-income households, allow them to live in less crowded homes, and minimize the risk of homelessness. Research also shows, howeve...
Source: Regional Science and Urban Economics - July 11, 2018 Category: Science Source Type: research

Measurement and valuation of urban greenness: Remote sensing and hedonic applications to Lisbon, Portugal
Publication date: Available online 6 March 2017Source: Regional Science and Urban EconomicsAuthor(s): Sofia F. Franco, Jacob L. MacdonaldAbstractThis paper explores the role of remote sensing techniques in capturing urban environmental data in the form of tree canopy coverage and measures of urban greenery. Using a classification algorithm, we identify tree canopy coverage in Lisbon, Portugal, to be approximately 8%. Our results have an accuracy rating of approximately 90% highlighting the benefits of this technique in capturing novel forms of data.Using these measures aggregated to the neighborhood level, we explore the i...
Source: Regional Science and Urban Economics - July 11, 2018 Category: Science Source Type: research

Strategical interactions on municipal public safety spending with correlated private information
Publication date: Available online 10 March 2017Source: Regional Science and Urban EconomicsAuthor(s): Chao Yang, Lung-fei LeeAbstractWe investigate interactions of public safety spending among spatially related local jurisdictions in a framework of simultaneous move game both theoretically and empirically. Incorporating the mobility of residents and externality of public safety services, it is found that the public safety spending of a municipal government can be negatively related to those of its neighbors, which is empirically supported by a general interaction model with correlated private information using the data on...
Source: Regional Science and Urban Economics - July 11, 2018 Category: Science Source Type: research

Outer-product-of-gradients tests for spatial autoregressive models
Publication date: Available online 27 March 2017Source: Regional Science and Urban EconomicsAuthor(s): Fei Jin, Lung-fei LeeAbstractFor Lagrangian multiplier (LM) tests of restrictions on parameters in spatial autoregressive (SAR) models with (SARAR models) or without SAR disturbances, their outer-product-of-gradient (OPG) variants can be simple and robust to unknown heteroskedasticity. However, for certain tests, asymptotic distributions of test statistics might depend on the constrained maximum likelihood or quasi maximum likelihood (QML) estimators, so their OPG variants would not be valid. To overcome such a hurdle, we...
Source: Regional Science and Urban Economics - July 11, 2018 Category: Science Source Type: research