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Gonzalo Paz-Pardo

Research

Division

Monetary Policy Research

Current Position

Senior Economist

Fields of interest

Macroeconomics and Monetary Economics,Labour Economics,Public Economics

Email

Gonzalo.Paz_Pardo@ecb.europa.eu

Education
2014-2020

PhD Economics, University College London, UK

2013-2014

MSc Economics, University College London, UK

2009-2013

BA Economics, A Coruña University, Spain

26 January 2022
RESEARCH BULLETIN - No. 91
Details
Abstract
Homeownership among younger households has been decreasing in several major advanced economies. In this analysis, I show that increases in labour income inequality and uncertainty are key drivers of this trend. Confronted with high house prices and low, risky incomes, many young households cannot or do not want to risk making such a big, illiquid investment. As a result, they accumulate less wealth.
JEL Code
D31 : Microeconomics→Distribution→Personal Income, Wealth, and Their Distributions
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E24 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Employment, Unemployment, Wages, Intergenerational Income Distribution, Aggregate Human Capital
G11 : Financial Economics→General Financial Markets→Portfolio Choice, Investment Decisions
J31 : Labor and Demographic Economics→Wages, Compensation, and Labor Costs→Wage Level and Structure, Wage Differentials
8 February 2021
WORKING PAPER SERIES - No. 2522
Details
Abstract
Earnings are riskier and more unequal for households born in the 1960s and 1980s than for those born in the 1940s. Despite the improvements in financial conditions, younger generations are less likely to be living in their own homes than older generations at the same age. By using a life-cycle model with housing and portfolio choice that includes flexible earnings risk and aggregate asset price risk, I show that changes in earnings dynamics account for a large part of the reduction in homeownership across generations. Lower-income households find it harder to buy housing, and as a result accumulate less wealth.
JEL Code
D31 : Microeconomics→Distribution→Personal Income, Wealth, and Their Distributions
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E24 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Employment, Unemployment, Wages, Intergenerational Income Distribution, Aggregate Human Capital
G11 : Financial Economics→General Financial Markets→Portfolio Choice, Investment Decisions
J31 : Labor and Demographic Economics→Wages, Compensation, and Labor Costs→Wage Level and Structure, Wage Differentials
2021
Journal of Public Economics
  • De Nardi, M., Fella, G., Knoef, M., Paz-Pardo, G., van Ooijen, R.
2020
Journal of the European Economic Association
  • De Nardi, M., Fella, G., Paz-Pardo, G.