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Re-evaluating the impact of immigration on the U.S. rental housing market

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  • Sharpe, Jamie
Abstract
Previous studies provide evidence that immigration increases housing prices and rents. To deal with endogenous location choices of immigrants, these studies often use a shift-share instrumental variable approach. This approach, however, fails to adequately account for the natural attraction of immigrants to cities with thriving economies. High-immigration cities provide more economic opportunities and thus exhibit persistently rising housing prices and rents. This paper improves upon the traditional empirical approach by explicitly controlling for initial city characteristics that lead to both increases in immigration and the evolution of rents. Results suggest that after controlling for endogenous sorting of immigrants, the positive effect of immigration on rents is attenuated. While the impact of immigrant inflows is smaller, an extension of the main results suggests the effects of immigration on rents remains larger than that of native inflows.

Suggested Citation

  • Sharpe, Jamie, 2019. "Re-evaluating the impact of immigration on the U.S. rental housing market," Journal of Urban Economics, Elsevier, vol. 111(C), pages 14-34.
    • Handle: RePEc:eee:juecon:v:111:y:2019:i:c:p:14-34
    DOI: 10.1016/j.jue.2019.04.001
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    Cited by:

    1. Sanchis-Guarner, Rosa, 2023. "Decomposing the impact of immigration on house prices," Regional Science and Urban Economics, Elsevier, vol. 100(C).
    2. Michael A Clemens, 2022. "The economic and fiscal effects on the United States from reduced numbers of refugees and asylum seekers," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 38(3), pages 449-486.
    3. Adrian Mehic, 2022. "Regional aspects of immigration‐related changes in political preferences," Journal of Regional Science, Wiley Blackwell, vol. 62(5), pages 1386-1413, November.
    4. Sharpe, Jamie & Bollinger, Christopher R., 2020. "Who competes with whom? Using occupation characteristics to estimate the impact of immigration on native wages," Labour Economics, Elsevier, vol. 66(C).
    5. Huang, Naqun & Yang, Zhenlin, 2021. "Spatial dynamic models with short panels: Evaluating the impact of purchase restrictions on housing prices," Economic Modelling, Elsevier, vol. 103(C).
    6. Yimu Ji & Ye Wu & Dianchao Zhang & Yongge Yuan & Shangdong Liu & Roozbeh Zarei & Jing He, 2020. "A Novel Flash P2P Network Traffic Prediction Algorithm based on ELMD and Garch," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 19(01), pages 127-141, March.
    7. Yamagishi, Atsushi, 2019. "Minimum Wages and Housing Rents: Theory and Evidence from Two Countries," MPRA Paper 94238, University Library of Munich, Germany.

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    More about this item

    Keywords

    Immigration; Rental housing; Housing prices;
    All these keywords.

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets

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