Working Paper: CEPR ID: DP18671
Authors: Luc Laeven; Alexander Popov; Clara Sievert
Abstract: An increase in local house prices in the US is associated with a decline in time spent on religious activities for homeowners relative to renters. This effect is not present for volunteering and civic activities. The decline in religious activities is stronger for credit constrained households. The main result is driven by a wealth effect, whereby activities that have an inferior-good component decline with housing wealth, and by a substitution effect whereby the attractiveness of activities linked to the residential asset increases during housing booms.
Keywords: home ownership; house prices; social capital; religion; time allocation
JEL Codes: E21; J22; O18; R2; Z12
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Increase in local house prices (R31) | Decrease in time spent on religious activities for homeowners (Z12) |
| Increase in local house prices (R31) | Reallocation of time towards more luxurious activities for homeowners (R21) |
| Increase in local house prices (R31) | Decrease in engagement in religious practices for homeowners (Z12) |
| Increase in local house prices (R31) | More pronounced decline in religious activities among credit-constrained households (Z12) |
| Increase in local house prices (R31) | No similar decline in time allocated to volunteering or civic engagement (J29) |