The Effects of House Prices and Home Equity Extraction on Career Outcomes

83 Pages Posted: 16 Dec 2019 Last revised: 31 Aug 2023

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

Pontificia Universidad Católica de Chile - School of Business

Date Written: August 30, 2023

Abstract

This paper investigates the effects of housing wealth shocks on workers' career decisions, particularly job quality, and long-term career outcomes. Using a novel data set of career histories in the film industry, we find that homeowners facing greater house price declines reduce participation in high-quality projects but increase involvement in low-quality films. Conversely, renters are not affected by these shocks. Consistent with individuals using home equity during job searches, these shocks have a greater impact on homeowners who extracted home equity during the housing boom. Moreover, house price declines from the housing crisis affect long-term career paths.

Keywords: Job Search, Long-term Career Effects, Housing Wealth Shocks, Home Equity Extraction

Suggested Citation

Cespedes, Jacelly and Liu, Zack and Parra, Carlos, The Effects of House Prices and Home Equity Extraction on Career Outcomes (August 30, 2023). 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

Pontificia Universidad Católica de Chile - School of Business ( email )

Vicuna Mackenna 4860
Santiago
Chile

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

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