The Impact of Neighborhood Homeownership Rates: A Review of the Theoretical and Empirical Literature

Ohio State University, Department of Economics

40 Pages Posted: 16 Mar 2002

See all articles by Donald R. Haurin

Donald R. Haurin

Ohio State University (OSU) - Economics

Robert D. Dietz

National Association of Home Builders

Bruce A. Weinberg

Ohio State University (OSU) - Economics; Institute for the Study of Labor (IZA); National Bureau of Economic Research (NBER)

Date Written: March 6, 2002

Abstract

Interest in measuring the impact of neighborhood homeownership rates on the residents of a neighborhood and on surrounding neighborhoods is increasing. This topic is part of the growing literature in the social sciences that discusses the theory and measurement of how neighborhoods affect individuals. In this review, we report on the conceptual categorization of the types of neighborhood effects, we review the social science literature that presents theories of how neighborhoods affect the residents or surrounding areas, and we review the empirical literature that measures the size of neighborhood effects. Throughout, we highlight the impact that differences in neighborhood homeownership rates may have on the economic and social outcomes of the residents. We find numerous theories that, when applied to neighborhood homeownership rates, have rich sets of testable predictions. In contrast, we find few empirical studies of the impact of neighborhood homeownership rates. We conclude that little is known about the impact of cross-sectional or intertemporal variations in neighborhood ownership rates and a substantial amount of additional research is needed. We show that understanding the way in which neighborhood homeownership rates impact behaviors is very important to measuring the impact of public policy. Also, knowing whether neighborhood homeownership effects have a nonlinear impact is important when deciding whether public policy should encourage clusters of homeowners.

Keywords: Neigborhood effects, homeownership, spatial effects, house prices

JEL Classification: R21, R00, J10, D71, D1

Suggested Citation

Haurin, Donald R. and Dietz, Robert D. and Weinberg, Bruce A., The Impact of Neighborhood Homeownership Rates: A Review of the Theoretical and Empirical Literature (March 6, 2002). Ohio State University, Department of Economics. Available at SSRN: https://ssrn.com/abstract=303398 or http://dx.doi.org/10.2139/ssrn.303398

Donald R. Haurin (Contact Author)

Ohio State University (OSU) - Economics ( email )

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Robert D. Dietz

National Association of Home Builders ( email )

United States

Bruce A. Weinberg

Ohio State University (OSU) - Economics ( email )

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Columbus, OH 43210-1172
United States
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614-292-3906 (Fax)

Institute for the Study of Labor (IZA)

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Bonn, D-53072
Germany

National Bureau of Economic Research (NBER)

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