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  4. May 2012
  5. Did the Housing Price Bubble Clobber Local Labor Market Job and Worker Flows When It Burst?

American Economic Review

ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)

Did the Housing Price Bubble Clobber Local Labor Market Job and Worker Flows When It Burst?

  • John M. Abowd
  • Lars Vilhuber
American Economic Review
vol. 102, no. 3, May 2012
(pp. 589–93)
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Abstract

We use the Census Bureau's Quarterly Workforce Indicators and the Federal Housing Finance Agency's House Price Indices to study the effects of the housing price bubble on local labor markets. We show that the 35 MSAs in the top decile of the house price boom were most severely impacted. Their stable job employment fell much more than the national average. Their real wage rates did not fall as fast as the national average. Accessions fell much faster than average while separations were constant. Job creations fell substantially while destructions rose slightly.

Citation

Abowd, John M., and Lars Vilhuber. 2012. "Did the Housing Price Bubble Clobber Local Labor Market Job and Worker Flows When It Burst?" American Economic Review, 102 (3): 589–93. DOI: 10.1257/aer.102.3.589

Additional Materials

JEL Classification

  • E32 Business Fluctuations; Cycles
  • R23 Urban, Rural, Regional, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics
  • R31 Housing Supply and Markets
  • E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital