Wall Street and the Housing Bubble

S-Tier
Journal: American Economic Review
Year: 2014
Volume: 104
Issue: 9
Pages: 2797-2829

Authors (3)

Ing-Haw Cheng (Dartmouth College) Sahil Raina (not in RePEc) Wei Xiong (not in RePEc)

Score contribution per author:

2.691 = (α=2.02 / 3 authors) × 4.0x S-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We analyze whether mid-level managers in securitized finance were aware of a large-scale housing bubble and a looming crisis in 2004-2006 using their personal home transaction data. We find that the average person in our sample neither timed the market nor were cautious in their home transactions, and did not exhibit awareness of problems in overall housing markets. Certain groups of securitization agents were particularly aggressive in increasing their exposure to housing during this period, suggesting the need to expand the incentives-based view of the crisis to incorporate a role for beliefs.

Technical Details

RePEc Handle
repec:aea:aecrev:v:104:y:2014:i:9:p:2797-2829
Journal Field
General
Author Count
3
Added to Database
2026-01-25