GY314      Half Unit
The Economics of Housing Markets and Migration

This information is for the 2025/26 session.

Course Convenor

Availability

Requisites

Additional requisites:

Students should have normally taken Microeconomics I (EC1A1 or EC1A3 or EC1A5) in combination with Macroeconomics I (EC1B1 or EC1B3 or EC1B5), and one or more of GY209, GY210, GY222, EC2A1, EC2A3 or EC2A5.

The main aim of this course is to analyse how decisions made by individuals influence the distribution of economic activities across space. The lectures will focus on how people sort across areas; on how they express their demand and preferences for specific locations and spatial attributes; and on how individual decisions carry important implications for the urban/regional economies and their labour markets. The emphasis will be on quantitative aspects and the lectures will cover both economic theories and related empirical methodology/applications. The course will be split into two interrelated blocks. One will concentrate on residential markets and study decisions made by individuals in relation to tenure choice and demand for housing space. Some time will be devoted to analysing how these processes affect the neighbourhoods where individuals live in terms of social stratification and externalities. The other part of the course will analyse the dynamics of local labour markets, geographical mobility, national and international migration and their effects on the local economy.

Topics covered (provisional and subject to changes):
1. Housing markets: the own vs. rent decision
2. Housing markets: the elasticity of supply and demand of space
3. Housing markets: real estate cycles, price fluctuations and recent real estate trends
4. Housing markets: hedonics to uncover “what people want”
5. Neighbourhood effects: do places matter?
6. The externalities of homeownership and the public policy debates
7. Mobility, migration and the spatial equilibrium framework
8. Local labour markets, spatial mismatch and the Work-From-Home (WFH) 'revolution'
9. The local economic effects of migration: labour markets
10. The local economic effects of migration: innovation and entrepreneurship

20 hours of lectures and 9 hours of classes in the Winter Term.

This course has a reading week in Week 6 of Winter Term.

In the Department of Geography and Environment, teaching will be delivered through a combination of classes/seminars, pre-recorded lectures, live in-person and online lectures and other supplementary interactive live activities.

Students will be expected to prepare for group discussion of some readings and hand in short essays and/or problem sets.

Below are some indicative readings. A full reading list will be circulated at the start of term within the course syllabus.

Hilber, C. (2005): “Neighborhood Externality Risk and the Homeownership Status of Properties”, Journal of Urban Economics, 57(2), 213-241.
Mayer, C. and T. Somerville (2000): “Residential Construction: Using the Urban Growth Model to Estimate Housing Supply”, Journal of Urban Economics 48, 85-109.
Gibbons, S., S. Machin and O. Silva (2013): “Valuing School Quality Using Boundary Discontinuities”, Journal of Urban Economics, 75(1), 15-28.
Gibbons, S., O. Silva and F. Weinhardt (2013): “Everybody Needs Good Neighbours? Evidence from Students’ Outcomes in England”, Economic Journal, 123, 831-874.
Bracke, P., C. Hilber and O. Silva (2017): “Mortgage Debt and Entrepreneurship”, Journal of Urban Economics, 103(1), 52-66.
Card, D. (2005): “Is the New Immigration Really So Bad?”, Economic Journal, F300-F323.
Hunt, J. and M. Gauthier-Loiselle (2010): “How Much Does Immigration Boost Innovation?” American Economic Journal: Macroeconomics, 2, 31–56.

Exam (100%), duration: 120 Minutes in the Spring exam period