Finance is the fuel of economic growth. Yet, the same fuel, when excessive and triggered by
a shock of flame, can engender an economic crisis. For decades, the economics literature …

This paper uses an assignment model to understand the cross section of house prices within
a metro area. Movers' demand for housing is derived from a life-cycle problem with credit …

In this chapter, we review and discuss the large body of research that has developed over
the past 10-plus years that explores the interconnection of macroeconomics, finance, and …

In this paper we investigate whether a standard life-cycle model in which households
purchase nondurable consumption and consumer durables and face idiosyncratic income …

We argue and demonstrate that resource allocation within firms' internal capital markets
provides an important force countervailing financial market dislocation. We estimate a …

Are there times when durable spending is less responsive to economic stimulus? We argue
that aggregate durable expenditures respond more sluggishly to economic shocks during …

Rising house prices affect household spending by either loosening a household's lifetime
budget constraint (pure wealth effect) or the household's borrowing constraint so that …

Using a quantitative heterogeneous agents macro-housing model and detailed microdata,
this paper studies the drivers of the 2006–2011 housing bust, its spillovers to consumption …

The homeownership rate in Germany is one of the lowest among advanced economies. To
better understand this fact, we evaluate the role of specific housing policies that tend to …

This paper extends Carroll's (2006) endogenous grid method and its combination with value
function iteration by Barillas and Fernández-Villaverde (2007) to a class of dynamic …