Housing Search Frictions: Evidence from Detailed Search Data and a Field Experiment

74 Pages Posted: 26 May 2020

See all articles by Peter Bergman

Peter Bergman

Columbia University

Eric Chan

Babson College

Adam Kapor

Princeton University

Multiple version iconThere are 2 versions of this paper

Date Written: May 2020

Abstract

We randomized school quality information onto the listings of a nationwide housing website for low-income families. We use this variation and data on families' search and location choices to estimate a model of housing search and neighborhood choice that incorporates imperfect information and potentially biased beliefs. We find that imperfect information and biased beliefs cause families to live in neighborhoods with lower-performing, more segregated schools. Families underestimate school quality conditional on neighborhood characteristics. If we had ignored this information problem, we would have estimated that families value school quality relative to their commute downtown by half that of the truth.

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Suggested Citation

Bergman, Peter and Chan, Eric and Kapor, Adam, Housing Search Frictions: Evidence from Detailed Search Data and a Field Experiment (May 2020). NBER Working Paper No. w27209, Available at SSRN: https://ssrn.com/abstract=3609662

Peter Bergman (Contact Author)

Columbia University ( email )

Eric Chan

Babson College

Adam Kapor

Princeton University ( email )

22 Chambers Street
Princeton, NJ 08544-0708
United States

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