Information Shocks and the Dynamics of the Housing Market

28 Pages Posted: 24 Aug 2011

See all articles by Jon H. Fiva

Jon H. Fiva

Norwegian School of Management (BI) - Department of Economics

Lars J. Kirkebøen

Statistics Norway - Research Department

Date Written: September 2011

Abstract

In this paper, we analyze housing‐market reactions to the release of previously unpublished information on school quality. Using high‐quality housing data, which precisely bracket the timing of the information shock, we investigate housing‐price dynamics within school‐catchment areas. We find a robust short‐term housing‐market reaction to the publication of school‐quality indicators, suggesting that this information was new to the households, and that households are willing to pay for better schools. The publication effect does not seem to be permanent as prices revert to pre‐publication levels after two to three months.

Keywords: Information disclosure, hedonic methods, school quality, housing‐price dynamics, I21, I28, R21, R23

Suggested Citation

Fiva, Jon H. and Kirkebøen, Lars J., Information Shocks and the Dynamics of the Housing Market (September 2011). The Scandinavian Journal of Economics, Vol. 113, Issue 3, pp. 525-552, 2011, Available at SSRN: https://ssrn.com/abstract=1915846 or http://dx.doi.org/10.1111/j.1467-9442.2011.01651.x

Jon H. Fiva

Norwegian School of Management (BI) - Department of Economics ( email )

Oslo
Norway

Lars J. Kirkebøen

Statistics Norway - Research Department ( email )

Kongens Gt. 6
PO Box 8131 Dep
N-0033 Oslo
Norway

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