Over the course of the 20th century, governments have frequently used rent control to keep rents affordable, especially in times of crisis when housing is scarce. Existing research shows that rent control has undesirable side effects, such as overall societal welfare losses, market misallocation, a declining housing supply, and lower mobility. However, there has been little research examining the effect ...
Real estate is taxed at comparatively low rates in Germany, with primarily the affluent benefiting from numerous existing tax privileges. This Weekly Report describes the current state of real estate taxation in Germany and outlines reform proposals that could increase tax revenue, improve the efficiency of the tax system, and reduce wealth and income inequality. In the case of property tax, value-based ...
We consider the problem of regression with selectively observed covariates in a nonparametric framework. Our approach relies on instrumental variables that explain variation in the latent covariates but have no direct effect on selection. The regression function of interest is shown to be a weighted version of observed conditional expectation where the weighting function is a fraction of selection ...
The construction industry is increasingly becoming a key pillar of the business cycle in Germany. DIW Berlin’s construction volume calculation indicates a real expansion of construction services by around three percent each year over the next two years. In nominal terms, sales in the construction industry and its related sectors will grow by around 6.5 percent in 2020 and almost six percent in 2021. ...
This paper explores the methodological issues to take into account when using SOEP as a database for calculating a measure of housing costs and housing affordability. For this purpose, we focus on the evolution of housing costs for households headed by elderly people between 1998 and 2018. Our review yields two clear conclusions: (1) that SOEP represents a valuable source of data for calculating household ...
Refugees are at an increased risk of mental health problems and low subjective well-being. Living circumstances in the host country are thought to play a vital role in shaping these health outcomes, which, in turn, are prerequisites for successful integration. Using data from a representative survey of 4325 adult refugees who arrived in Germany between 2013 and 2016, we investigated how different living ...
In an urban economy, the distribution of people and real estate prices depends on the location of the central business district of a city. As distance from the city center increases, both prices and population density diminish, for travel costs increase in terms of time and money. As manufacturing gradually leaves the cities, the importance of consumer amenities as attractors of population to the urban ...
Multivariate Adaptive Regression Spline (MARS) is a simple and powerful non-parametric technique that automatizes the selection of non-linear terms in regression models. Non-linearities and spatial effects are natural characteristics in numerous spatial hedonic pricing models. In this paper, we propose using the MARS data-driven methodology combined with the Instrumental Variables method in order to ...
Following World War I, rent control became a standard policy response to the housing shortage and the resulting rent increases. Typically, economists blame it for creating inefficiencies in the housing market and beyond. We investigate whether rental market regulations (including rent control, protection of tenants from eviction, and housing rationing) had any effects in a middle-income Latin American ...
This study introduces a new international longitudinal database of governmental rental market regulations. The regulations are measured using binary variables based on a thorough analysis of real-time, country-specific legislation. Three major restrictive policies are considered: rent control, protection from restriction, and housing rationing. The database covers 101 countries and states between 1910 ...