Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/322938 
Year of Publication: 
2015
Series/Report no.: 
U.S.E. Discussion Papers Series No. 15-12
Publisher: 
Utrecht University, Utrecht School of Economics, Tjalling C. Koopmans Research Institute, Utrecht
Abstract: 
This paper examines the effects of loss aversion and negative equity on household mobility. We stress the importance of studying these mechanisms simultaneously. By making use of a unique administrative data set of Statistics Netherlands, covering the period 2006-2011, we estimate the effects of loss aversion and negative equity. The results provide strong evidence for loss aversion, while less evidence is found for a lock-in effect of negative equity. The results indicate that moderately underwater households do have a lower mobility, but heavily underwater households do not. Additional results indicate that the particularly high mobility of heavily underwater households is not default-driven.
Subjects: 
Housing market
Household mobility
Loss aversion
Negative equity
Document Type: 
Working Paper

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