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Papers written by Author(s): 'Corey Lang'

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  • Working Paper

    The Dynamics of House Price Capitalization and Locational Sorting: Evidence from Air Quality Changes

    September 2012

    Authors: Corey Lang

    Working Paper Number:

    CES-12-22

    Despite extensive use of housing data to reveal valuation of non-market goods, the process of house price capitalization remains vague. Using the restricted access American Housing Survey, a high-frequency panel of prices, turnover, and occupant characteristics, this paper examines the time path of capitalization and preference-based sorting in response to air quality changes caused by differential regulatory pressure from the 1990 Clean Air Act Amendments. The results demonstrate that owner-occupied units capitalize changes immediately, whereas rent capitalization lags. The delayed but sharp rent capitalization temporally coincides with evidence of sorting, suggesting a strong link between location choices and price dynamics.
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