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Distributional Implications of Government Guarantees in Mortgage Markets

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dc.contributor.authorGete, Pedro
dc.contributor.authorZecchetto, Franco
dc.contributor.funderMinisterio de Economía y Competitividad
dc.contributor.rorhttps://ror.org/02jjdwm75
dc.date.accessioned2024-11-07T11:21:32Z
dc.date.available2024-11-07T11:21:32Z
dc.date.issued2017-07-20
dc.description.abstractWe analyze the removal of the credit-risk guarantees provided by the government-sponsored enterprises (GSEs) in a model with agents heterogeneous in income and house price risk. We find that wealth inequality increases, driven by higher mortgage spreads and housing rents. Housing holdings become more concentrated. Foreclosures fall. The removal benefits high-income households, while hurting low- and mid-income households (renters and highly leveraged mortgagors with conforming loans). GSE reform requires compensating transfers, sufficiently high elasticity of rental supply, or linking GSE reform with the elimination of the mortgage interest deduction.
dc.description.peerreviewedyes
dc.description.statusPublished
dc.formatapplication/pdf
dc.identifier.citationPedro Gete, Franco Zecchetto, Distributional Implications of Government Guarantees in Mortgage Markets, The Review of Financial Studies, Volume 31, Issue 3, March 2018, Pages 1064–1097, https://doi.org/10.1093/rfs/hhx083
dc.identifier.doihttps://doi.org/10.1093/rfs/hhx083
dc.identifier.issn1465-7368
dc.identifier.officialurlhttps://academic.oup.com/rfs
dc.identifier.urihttps://hdl.handle.net/20.500.14417/3310
dc.issue.number3
dc.journal.titleThe Review of Financial Studies
dc.language.isoen
dc.page.final1097
dc.page.initial1064
dc.page.total33
dc.publisherOxford University Press
dc.relation.departmentFinance
dc.relation.entityIE University
dc.relation.schoolIE Business School
dc.rightsAttribution-NonCommercial-NoDerivatives 4.0 International
dc.rights.accessRightsinfo:eu-repo/semantics/openAccess
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/4.0/
dc.subject.keywordE-51 Money Supply
dc.subject.keywordCredit
dc.subject.keywordG21- Banks
dc.subject.keywordDepository Institutions
dc.subject.keywordMicro Finance Institutions
dc.subject.keywordLoan Guarantees
dc.subject.keywordCredits
dc.subject.keywordGrants
dc.titleDistributional Implications of Government Guarantees in Mortgage Markets
dc.typeinfo:eu-repo/semantics/article
dc.version.typeinfo:eu-repo/semantics/acceptedVersion
dc.volume.number31
dspace.entity.typePublication
relation.isAuthorOfPublication627e06b8-d61f-4611-96fe-15cf32670e9f
relation.isAuthorOfPublication.latestForDiscovery627e06b8-d61f-4611-96fe-15cf32670e9f
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