Martinez-Mazza, Rodrigo;
(2023)
"Mom, Dad: I'm Staying": Young adults, housing, and labor markets.
SSRN: Amsterdam, Netherlands.
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Abstract
Young adults worldwide face significant challenges in leaving their parental homes. Despite improvements in labor market conditions since the Great Recession, housing markets struggle to provide viable solutions for young adults seeking independence. In this paper, I provide causal evidence that poor initial labor market conditions have adverse and long-lasting effects on housing tenure and affordability. I do so by exploiting the unemployment rate across European college graduates at the time of their graduation. Furthermore, I develop an overlapping generations model to prove that housing markets fail to adapt as outside options for landlords make rents rigid, driving the rise in co-residency among young adults. The model also offers policy insights into the roles of parental aid and housing allowances in facilitating household formation.
| Type: | Working / discussion paper |
|---|---|
| Title: | "Mom, Dad: I'm Staying": Young adults, housing, and labor markets |
| Open access status: | An open access version is available from UCL Discovery |
| DOI: | 10.2139/ssrn.4501330 |
| Publisher version: | https://dx.doi.org/10.2139/ssrn.4501330 |
| Language: | English |
| Additional information: | This version is the version of record. For information on re-use, please refer to the publisher’s terms and conditions. |
| Keywords: | Housing, labor markets, housing policy |
| UCL classification: | UCL UCL > Provost and Vice Provost Offices > UCL BEAMS UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of the Built Environment |
| URI: | https://discovery-pp.ucl.ac.uk/id/eprint/10201658 |
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