House Transactions in the Macroeconomy as Needs Change over the Life Cycle
(2023) NEKP01 20231Department of Economics
- Abstract
- A long-term overlapping generations macroeconomic framework is presented, in which a downsizing old generation bargains with an upsizing middle-aged generation to settle on house prices. In this model, both expectations, which are coordinated by the relative bargaining power of each generation, and credit conditions, which influence the range of prices each side will accept, are important for the resulting house price. High house prices bind more wealth to an asset without dividend, so decreasing the house price is found to generally be welfare-improving in the long run. A decreased price can be accomplished by strengthening the relative bargaining position of the middle-aged buyer generation or by tightening credit conditions, although... (More)
- A long-term overlapping generations macroeconomic framework is presented, in which a downsizing old generation bargains with an upsizing middle-aged generation to settle on house prices. In this model, both expectations, which are coordinated by the relative bargaining power of each generation, and credit conditions, which influence the range of prices each side will accept, are important for the resulting house price. High house prices bind more wealth to an asset without dividend, so decreasing the house price is found to generally be welfare-improving in the long run. A decreased price can be accomplished by strengthening the relative bargaining position of the middle-aged buyer generation or by tightening credit conditions, although the latter can have negative side effects. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9118301
- author
- Åkerlund, Ruben LU
- supervisor
- organization
- course
- NEKP01 20231
- year
- 2023
- type
- H2 - Master's Degree (Two Years)
- subject
- keywords
- House Prices, Bargaining, Multiple Equilibria
- language
- English
- id
- 9118301
- date added to LUP
- 2023-06-19 10:09:01
- date last changed
- 2023-06-19 10:09:01
@misc{9118301, abstract = {{A long-term overlapping generations macroeconomic framework is presented, in which a downsizing old generation bargains with an upsizing middle-aged generation to settle on house prices. In this model, both expectations, which are coordinated by the relative bargaining power of each generation, and credit conditions, which influence the range of prices each side will accept, are important for the resulting house price. High house prices bind more wealth to an asset without dividend, so decreasing the house price is found to generally be welfare-improving in the long run. A decreased price can be accomplished by strengthening the relative bargaining position of the middle-aged buyer generation or by tightening credit conditions, although the latter can have negative side effects.}}, author = {{Åkerlund, Ruben}}, language = {{eng}}, note = {{Student Paper}}, title = {{House Transactions in the Macroeconomy as Needs Change over the Life Cycle}}, year = {{2023}}, }