Micro and Macro Implications of Household Behaviour and Financial Decision-Making is a new cross-disciplinary seminar series covering research at the intersection of household finance, macro and labour economics. It represents a collaboration between universities and research networks and centres.
 
Seminars are held on Zoom on each month and will run for 90 minutes including a discussion panel.
 
Our third meeting will be on Friday 28th May from 3:30pm-5:00pm BST and will feature Monika Piazzesi (Stanford and CEPR) presenting Learning about Housing Cost: Survey Evidence from the German House Price Boom. Discussion by Ulrike Malmendier (University of California, Berkeley and CEPR) and Stijn van Nieuwerburgh (Columbia University and CEPR).  

Registration Link:
https://us02web.zoom.us/meeting/register/tZUtd-CsrTotE9QeKAgm4qinwi2-6V2fmg8I
 
Organisers: Richard Blundell, Michael Haliassos, Christopher Hansman, Yigitcan Karabulut, Peter Levell, Benjamin Moll, Tarun Ramadorai, and Polly Simpson.
            
Abstract:
This paper uses new household survey data to study expectation formation during the recent housing boom in Germany. The cross section of forecasts depends on only two household characteristics: location and tenure. The average household in a region responds to local conditions but underpredicts local price growth. Renters make on average higher and hence more accurate forecasts than owners, although their forecasts are more dispersed and their mean squared forecast errors are higher. A quantitative model of learning about housing cost can match these facts. It emphasizes the unique information structure of housing among asset markets: renters who do not own the asset are relatively well informed about its cash flow, since they pay for housing services that owners simply consume. Renters then make more accurate forecasts in a boom driven by an increase in rents and recovery from a financial crisis.