The Effect of Noise Barriers on the Market Value of Adjacent Residential Properties

This paper provides the first study on the impact of noise barriers on the price of adjacent houses based on a repeat sale analysis (RSA). RSA allows us to empirically examine the differential between the prices of houses sold before and after an event that may have affected their value, and after other relevant variables such as the evolution of the real estate market and major renovations performed on the house are controlled. This paper focuses on the neighborhood of Laval, a suburb of Montreal, where a large noise barrier was built in 1990 along a highway. The data set contains transaction information on 134 houses that were sold at least twice from 1980–2000. The empirical result will show that the noise barrier induced a decrease of 6% in the house prices in our sample in the short run, while it had a stronger negative impact of 11% in the long run.noise barriers; housing market; repeat sale analysis

Advertising, Pricing & Market Structure in Competitive Matching Markets

This paper develops a model of pricing and advertising in a matching environment with capacity constrained sellers. Sellers' expenditure on directly informative advertising attracts consumers only probabilistically. Consumers who happen to observe advertisements randomize over the advertised sellers using symmetric mixed strategies. Equilibrium prices and profit maximizing advertising levels are derived and their properties analyzed, including the interplay of prices and advertising with the market structure. The model generates a unimodal (inverted U-shape) relationship between both, individual and industry advertising level, and market structure. The relationship results from a trade off between a price effect and a market structure-matching effect. We find that the decentralized market has underprovision of advertising, both for individual sellers and industry wide, and that entry is excessive relative to the efficient level. We present a quantitative analysis to highlight properties of the models and to demonstrate the extent of inefficiency.Advertising, pricing, market structure, endogenous matching, asymmetric information, efficiency.

The Effect of Noise Barriers on the Market Value of Adjacent Residential Properties

This paper provides the first study on the impact of noise barriers on the price of adjacent houses based on a repeat sale analysis (RSA), arguably the best methodology to address this question. Essentially, a repeat sale analysis examines the differential between the prices of houses sold before and after an event that may have affected their value. If there is a significant change of price between the two transactions, it may be attributed to the event. Of course, for that to be true, the researcher must have controlled for other changes that may have had an effect on the house price between two sales, like the evolution of the real estate market and major renovations done to the house. We collected our data in a neighbourhood of Laval, a suburb of Montreal, where an important noise barrier has been built in 1990 along a highway. We were able to obtain information on 134 houses that have been sold at least twice during the period 1980 - 2000. In addition, we were able to get data on the real estate market in the area during the whole period, as in most RSA, but also on the demographic composition of the area and on major renovations that were done in these houses throughout the time span. To our knowledge, this is the first time that information on major renovations was available for a RSA. We conclude that the noise barrier has induced an increase of 10 %, on average, of the price of adjacent houses in our sample. Ce texte présente la première étude sur l'impact des murs antibruit sur le prix des maisons adjacentes basée sur une analyse des ventes répétées, qui constitue la meilleure méthodologie pour étudier cette question. Essentiellement, une analyse des ventes répétées nous permet d'examiner la différence de prix de vente pour une maison donnée avant et après un événement qui aurait pu en affecter le prix. S'il y a une différence de prix « significative » entre les deux transactions, on peut alors attribuer cette différence à l'événement. Bien sûr, pour que cela soit vrai, il faut s'assurer de tenir compte des autres éléments qui auraient pu affecter le prix de la maison entre les deux ventes, comme l'évolution générale du marché immobilier ou les rénovations majeures qui auraient pu être faites. Notre étude se base sur un quartier de la ville de Laval, une banlieue de Montréal, où un grand mur antibruit a été construit en 1990 le long d'une autoroute. Nous avons pu obtenir des informations sur 134 maisons qui ont été vendues au moins deux fois pendant la période 1980 - 2000. En plus, nous avons pu avoir des informations sur l'ensemble du marché immobilier, comme dans toutes les autres analyses de ventes répétées, mais aussi sur les caractéristiques sociodémographiques du secteur et sur les rénovations majeures qui ont touché ces maisons durant la période. À notre connaissance, c'est la première fois que des informations sur les rénovations sont disponibles dans une analyse des ventes répétées. Nous concluons que le mur antibruit a entraîné une augmentation de 10 %, en moyenne, du prix des maisons dans notre échantillon.noise barriers, housing market, repeat sale analysis, Contributions volontaires , pertes publiques, risque, ambiguïté, données expérimentales

Ex-ante production, directed search and indivisible money

There always exists a monetary equilibrium when search is directed, money is indivisible and production is on demand (Julien Kennes King 2007). We demonstrate that when production takes place before exchange, forcing sellers to incur a sunk cost, there must be a minimum buyer-seller ratio for the monetary equilibrium to survive.

Market Structure and the Banking Sector

We propose a simple framework to explore how different market structures in the banking system affect credit allocation, and how deposits and number of entrepreneurs affect the equilibrium number of banks in the economy. We find that within the Marshallian aggregate surplus perspective, the number of entrants in the banking system is always larger than the socially optimal number of banks.and Entry

Monetary Exchange with Multilateral Matching

This paper analyzes monetary exchange in a search model allowing for multilateral matches to be formed, according to a standard urn-ball process. We consider three physical environments: indivisible goods and money, divisible goods and indivisible money, and divisible goods and money. We compare the results with Kiyotaki and Wright (1993), Trejos and Wright (1995), and Lagos and Wright (2005) respectively. We …nd that the multilateral matching setting generates very simple and intuitive equilibrium allocations that are similar to those in the other papers, but which have important di¤erences. In particular, sur- plus maximization can be achieved in this setting, in equilibrium, with a positive money supply. Moreover, with ‡exible prices and directed search, the …rst best allocation can be attained through price posting or through auctions with lotteries, but not through auctions without lotteries. Finally, analysis of the case of divisible goods and money can be performed without the assumption of large families (as in Shi (1997)) or the day and night structure of Lagos and Wright (2005)Matching, Money, Directed Search

Residual Wage Disparity and Coordination Unemployment

We ask: how much of the observed wage dispersion, among similar workers, can be explained by a lack of coordination among employers in their hiring practices?To answer this, we construct a directed search model with homogenous workers where firms can create either good or bad jobs, are uncoordinated with their job offers, and where on-the-job search is possible. Workers can exploit ex post opportunities when determining wages. The stationary equilibrium has both productivity dispersion - different wages due to different job qualities, and contract dispersion - different wages due to different market experiences for workers, and is constrained-efficient. Job arrival rates are endogenous and, as found in empirical studies, smaller for on-the-job searchers than for unemployed workers. We calibrate the model to the US economy and compare the implied statistics with those for empirical data. The equilibrium wage distribution is hump shaped, skewed significantly to the right, and, with baseline parameters, generates residual dispersion statistics 75-90% the size of those found empirically. However, the model overestimates the values of job finding rates and underestimates the average duration of unemployment.

Spin-orbit evolution of Mercury revisited

While it is accepted that the eccentricity of Mercury (0.206) favours entrapment into the 3:2 spin-orbit resonance, open is the question how and when the capture took place. A recent work by Makarov (2012) has demonstrated that trapping into this resonance is certain if the eccentricity is larger than 0.2, provided that we use a realistic tidal model, the one which is based on the Darwin-Kaula expansion of the tidal torque. The physics-based tidal model changes dramatically the statistics of the possible final spin states. First, we discover that after only one encounter with the spin-orbit 3:2 resonance this resonance becomes the most probable end-state. Second, if a capture into this (or any other) resonance takes place, the capture becomes final, several crossings of the same state being forbidden by our model. Third, within our model the trapping of Mercury happens much faster than previously believed: for most histories, 10 - 20 Myr are sufficient. Fourth, even a weak laminar friction between the solid mantle and a molten core would most likely result in a capture in the 2:1 or even higher resonance. So the principal novelty of our paper is that the 3:2 end-state is more ancient than the same end-state obtained when the constant time lag model is employed. The swift capture justifies our treatment of Mercury as a homogeneous, unstratified body whose liquid core had not yet formed by the time of trapping. We also provide a critical analysis of the hypothesis by Wieczorek et al. (2012) that the early Mercury might had been retrograde, whereafter it synchronised its spin and then accelerated it to the 3:2 resonance. Accurate processing of the available data on cratering does not support that hypothesis, while the employment of a realistic rheology invalidates a key element of the hypothesis, an intermediate pseudosynchronous state needed to spin-up to the 3:2 resonance.Comment: Extended version of the submitted paper, accepted for publication in Icaru