Housing subsidy or parental support: crowding-out effect of mortgage tax deduction

Children may receive monetary transfers from their parents to realize the dream of homeownership. This raises the question of whether transfers received decrease if governments also provide a homeownership-related subsidy. The purpose of this paper is to empirically examine this question, using a sample of the Japanese home-buying households that are subsidized by a mortgage tax deduction (MTD) as a model case. In the empirical stage, we offer a test of the effect of the MTD on both the extensive (the probability of receiving transfers) and the intensive (the amount of transfers received) margins using the overall sample as well as subsample groups. The empirical results, which use the full sample, appear to indicate that the MTD has a tendency to crowd out transfers on both the extensive and the intensive margins. Subsample analysis demonstrates that the crowding-out effect is strengthened when parents\u27 behavior is influenced by a relatively strong altruistic motive and a relatively weak exchange motive

Housing assets and consumption among the Japanese elderly

A large proportion of the Japanese elderly have accumulated assets in the form of housing wealth. The elderly expect to fund consumption during their retirement by releasing housing equity. This paper estimates a fixed effects model to examine the causal effect of housing assets on consumption, using panel data of Japanese elderly households from 2006 to 2015. Contrary to the above expectation, the results suggest that changes in housing wealth do not significantly increase elderly consumption. The reason behind this result appears to be that the elderly homeowners cannot release part of their housing wealth as cash through the financial sector. Instead, elderly homeowners leave their housing assets to their children, and in exchange, receive cash to fund consumption. The impact on consumption, however, is rather small. Moreover, this mechanism tends to operate only in urban areas where the land values are relatively high. These results imply that housing wealth is available to only a limited proportion of Japanese elderly homeowners

Strategic interaction between inter vivos gifts and housing acquisition

To consider the policy event of a gift tax reduction earmarked for housing acquisition, the interdependence of parental gifts and children\u27s housing investments is modeled, considering an informal care issue behind such decision making. The empirical results, which use a sample of households who purchased a house in Japan, demonstrate that such a tax cut would appear to have the following limited effects on boosting housing investment in equilibrium. First, even though transfers are encouraged, they consequently reduce housing investment because the housing investment function is negatively related to gifts. Second, increments in housing investment are further discouraged because the slopes of the gift and housing investment functions have opposite signs

Housing inheritance, financial assistance, and reciprocal interdependence

When adult children expect that their parents will bequeath residential property to them, they may show their appreciation by providing their parents with financial support. This paper theoretically and empirically examines this possibility. We adopt a simple noncooperative game framework with a Stackelberg equilibrium to examine the reciprocal interdependence between the propensity of housing inheritance and financial assistance when formal care affects decision-making. We use data from Japanese households to test this interaction. After considering both the censoring of financial transfers and the specification of inheritance propensity, which we control for using information on formal care, our empirical results suggest that the propensity to inherit the parental home has a significantly positive impact on the amount of transfers from children to their parents. Consequently, an implicit annuity contract in the form of an intrafamily reverse mortgage appears to exist in Japanese society. However, parents should ensure they convey to their children a high expectation of future housing inheritance to extract sufficient financial assistance for their current consumption needs

Studying internal and external magnetic fields in Japan using MAGSAT data

Examination of the total intensity data of CHRONIT on a few paths over Japan and its neighboring sea shows MAGSAT is extremely useful for studying the local magnetic anomaly. In high latitudes, the signatures of field aligned currents are clearly recognized. These include (1) the persistent basic pattern of current flow; (2) the more intense currents in the summer hemisphere than in the winter hemisphere; (3) more fluctuations in current intensities in summer dawn hours; and (4) apparent dawn-dusk asymmetry in the field-aligned current intensity between the north and south polar regions

Housing subsidy or parental support: Crowding-out effect of mortgage tax deduction

Children may receive monetary transfers from their parents to realize the dream of homeownership. This raises the question of whether transfers received decrease if governments also provide a homeownership-related subsidy. The purpose of this paper is to empirically examine this question, using a sample of the Japanese home-buying households that are subsidized by a mortgage tax deduction (MTD) as a model case. In the empirical stage, we offer a test of the effect of the MTD on both the extensive (the probability of receiving transfers) and the intensive (the amount of transfers received) margins using the overall sample as well as subsample groups. The empirical results, which use the full sample, appear to indicate that the MTD has a tendency to crowd out transfers on both the extensive and the intensive margins. Subsample analysis demonstrates that the crowding-out effect is strengthened when parents' behavior is influenced by a relatively strong altruistic motive and a relatively weak exchange motive

Japanese Magsat Team. A: Crustal structure near Japan and its Antarctic Station. B: Electric currents and hydromagnetic waves in the ionosphere and the magnetosphere

Efforts continue in compiling tapes which contain vector and scalar data decimated at an interval of 0.5 sec, together with time and position data. A map of the total force field anomaly around Japan was developed which shows a negative magnetic anomaly in the Okhotsk Sea. Examination of vector residuals from the MGST model shows that the total force perturbation is almost ascribable to the perturbation parallel to the main geomagnetic field and that the contribution from the perturbation transverse to the main field to the total force perturbation is negligibly small. The influences of ionospheric current with equatorial electroject and of the magnetospheric field aligned current on the dawn-dusk asymmetry of daily geomagnetic variations are being considered. The total amount of electric current flowing through the plane of the Magsat orbit loop was calculated by direct application of Maxwell's equation. Results show that the total electric current is 1 to 5 ampheres, and the current direction is either sunward or antisunward

Report of investigation from Japanese MAGSAT Team

Progress in the data processing and data acquisition of computer compatible MAGSAT tapes is reported. Investigations focused on the crustal structure near Japan and its Antarctic station, and electric currents and hydrodynamic waves in the ionosphere and the magnetosphere. The magnetization of the crust in the northwestern Pacific region is discussed