Mark Toth

About me

Papers

Housing plays a key role in monetary policy transmission. With this paper, I investigate whether the spatial structure of housing matters as well. For a theoretical perspective, I integrate spatial structure into a monetary business cycle model. I characterize spatial structure via the spatial concentration of housing, that is, via residential concentration. In my theory, a stronger residential concentration dampens consumption responses to monetary policy shocks. Using geospatial data, I empirically validate this prediction for regions in the United States and the Eurozone. My paper establishes that granular spatial features of the housing market affect short-run macroeconomic dynamics.

This paper examines the relationship between location, liquidity, and prices in housing markets. We construct spatial datasets for German and U.S. cities and show that liquidity and prices decline with distance to the city center. To rationalize these results, we build and estimate a spatial housing search model. Our model demonstrates that travel costs determine the spatial distribution of liquidity and prices. In a counterfactual analysis, we suppress search frictions and find that frictional illiquidity reduces prices and welfare, particularly in the outskirts. Our findings underpin the importance of demand-side preferences for asset pricing.

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