Homeownership: yesterday, today and tomorrow

Purpose – The American Dream and homeownership are sometimes thought of as one and the same. A belief that homeownership is vital to the fabric of a vibrant society has led to government policies that encourage homeownership. This suggests that homeownership and societal well-being are positively related. However, empirical analysis does not support this positive relationship either within the USA or across countries. This has important policy implications given the research in this special issue that discusses the macro and micro economic consequences of government programs that promote homeownership. Moving forward, we must consider both the private and public benefits of homeownership and also realize that the very concept of what a house is will likely change. This paper aims to discuss these issues. Design/methodology/approach – The analysis examines the relation between the incidence of homeownership and the well-being (happiness) of a community. The analysis is first performed across the 50 states and then is done on a cross-section of 26 countries. Findings – The correlation coefficient between home ownership rates and well-being are negative for both the US and international data. The evidence does not support the belief that homeownership is either necessary or sufficient for societal well-being. Originality/value – The paper presents some of the first empirical analysis to examine the relationship between homeownership and societal well-being. Other studies in this special issue document both public and price costs to owning a home. Taken together, the special issue has important implications for government policies that encourage homeownership.Private ownership, Residential homes, Societal organization, United States of America

A Test of Market Efficiency When Short Selling Is Prohibited: A Case of the Dhaka Stock Exchange

A ban on short selling exists on several exchanges, especially in emerging markets. In most cases, short selling has always been prohibited, thus making it difficult to examine the ban’s effect on price discovery. In this paper, we consider data from the Dhaka Stock Exchange (DSE) to test for a short selling ban on market efficiency. The analysis examines runs in daily stock returns and then forms a distribution of return clusters according to their duration. Using Monte Carlo simulation, we find that runs of longer duration appear more frequently in the DSE data than we would expect in efficient markets. We compare these results to stocks in the Dow Jones Industrial Average (DJIA). We find that the same runs tests accord with market efficiency for liquid and easily shorted DJIA stocks

Economic Forecasts, Rationality, and the Processing of New Information over Time.

This study analyzes real GNP and inflation forecasts published in the Blue Chip Economic Indicators. The survey revises annual growth rate estimates every month, thus making it possible to analyze the value of new information and its contribution to the estimates' predictive power of the actual values. If information is used efficiently, updated forecasts should provide more accurate predictions. The empirical results suggest that the revised forecasts of real GNP growth and inflation incorporate new information in a rational manner. In addition, the most recent inflation forecasts are found to be unbiased estimates on the actual rate of inflation. Copyright 1990 by Ohio State University Press.