Almost Famous: How Wealth Shocks Impact Career Choices

69 Pages Posted: 16 Dec 2019 Last revised: 20 Oct 2020

See all articles by Jacelly Cespedes

Jacelly Cespedes

University of Minnesota - Carlson School of Management

Zack Liu

University of Houston - Department of Finance

Carlos Parra

Pontifical Catholic University of Chile - School of Business

Date Written: October 6, 2020

Abstract

Using a novel data set of career histories in the film industry, we study the effect of housing wealth shocks on the quality of jobs that individuals pursue. Homeowners facing greater local house price declines reduce their participation in high-quality projects, such as big-budget films and productions with award-winning talent, but increase their involvement in low-quality films. Importantly, these effects cannot be explained by changes to local labor demand. Consistent with job search models under limited liquidity, these effects are stronger for less-wealthy homeowners and those with less home equity. These short-term wealth shocks also affect long-term career trajectories.

Keywords: Career Choices, Job Search, Employer/Employee Matching, Long-term Effects, Wealth Shocks, Labor Economics, Real Estate

Suggested Citation

Cespedes, Jacelly and Liu, Zack and Parra, Carlos, Almost Famous: How Wealth Shocks Impact Career Choices (October 6, 2020). Available at SSRN: https://ssrn.com/abstract=3491426 or http://dx.doi.org/10.2139/ssrn.3491426

Jacelly Cespedes

University of Minnesota - Carlson School of Management ( email )

19th Avenue South
Minneapolis, MN 55455
United States

HOME PAGE: http://sites.google.com/site/jacellycespedes/

Zack Liu (Contact Author)

University of Houston - Department of Finance ( email )

Houston, TX 77204
United States

Carlos Parra

Pontifical Catholic University of Chile - School of Business ( email )

Vicuna Mackenna 4860
Santiago
Chile

HOME PAGE: http://www.carlosrparra.com/

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