NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Lorenz Goette

Université de Lausanne

E-Mail: Lorenz.Goette@unil.ch

NBER Working Papers and Publications

April 2010Reducing Foreclosures: No Easy Answers
with Christopher Foote, Kristopher Gerardi, Paul Willen
in NBER Macroeconomics Annual 2009, Volume 24, Daron Acemoglu, Kenneth Rogoff and Michael Woodford, editors
June 2009Reducing Foreclosures: No Easy Answers
with Christopher Foote, Kristopher Gerardi, Paul Willen: w15063
This paper takes a skeptical look at a leading argument about what is causing the foreclosure crisis and distills some potential lessons for policy. We use an economic model to focus on two key decisions: the borrower's choice to default on a mortgage and the lender's subsequent choice whether to renegotiate or "modify" the loan. The theoretical model and econometric analysis illustrate that "unaffordable" loans, defined as those with high mortgage payments relative to income at origination, are unlikely to be the main reason that borrowers decide to default. In addition, this paper provides theoretical results and empirical evidence supporting the hypothesis that the efficiency of foreclosure for investors is a more plausible explanation for the low number of modifications to date than co...

Published: Acemoglu, Daron, Kenneth Rogoff, and Michael Woodford (eds.) NBER Macroeconomics Annual 2009, Volume 24. Chicago: University of Chicago Press, 2010.

October 2008Using Behavioral Economic Field Experiments at a Firm: The Context and Design of the Truckers and Turnover Project
with Stephen V. Burks, Jeffrey Carpenter, Kristen Monaco, Kay Porter, Aldo Rustichini
in The Analysis of Firms and Employees: Quantitative and Qualitative Approaches, Stefan Bender, Julia Lane, Kathryn Shaw, Fredrik Andersson, and Till von Wachter, editors
March 2007Using Behavioral Economic Field Experiments at a Large Motor Carrier: The Context and Design of the Truckers and Turnover Project
with Stephen V. Burks, Jeffrey Carpenter, Kristen Monaco, Aldo Rustichini, Kay Porter: w12976
The Truckers and Turnover Project is a statistical case study of a single firm and its employees which matches proprietary personnel and operational data to new data collected by the researchers to create a two-year panel study of a large subset of new hires. The project's most distinctive innovation is the data collection process which combines traditional survey instruments with behavioral economics experiments. The survey data include information on demographics, risk and loss aversion, time preference, planning, non-verbal IQ, and the MPQ personality profile. The data collected by behavioral economics experiments include risk and loss aversion, time preferences (discount rates), backward induction, patience, and the preference for cooperation in a social dilemma setting. Subjects w...
 
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