John Duca, John Muellbauer, Anthony Murphy, 13 September 2021

Research on house price cycles and their interactions with the economy has burgeoned since the Global Financial Crisis. This column draws five lessons from a recent comprehensive survey. It argues that conventional theories of house price dynamics are misleading. Shifts in credit conditions, together with differences in housing supply response across cities, regions and countries, account for much of the heterogeneity of house price outcomes. Finally, increased demand for space and unprecedented policy interventions together explain the very different house price experience in the pandemic compared with the Global Financial Crisis.

Juan Pablo Cuesta, Swarnali Ahmed Hannan, 12 August 2021

Covid-19 has had a staggering adverse impact on lives and livelihoods, disproportionately affecting the poor and the vulnerable. To shed light on possible scarring effects, this column studies the effect of five past pandemics on output, unemployment, poverty, and inequality in the near and medium term. The findings reveal significant negative effects, although countries that provided relatively large fiscal support experienced limited output declines. Historically, increases in unemployment, poverty, and inequality were lower for countries with greater fiscal support and relatively stronger initial conditions, which included higher formality, family benefits, and health spending. 

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