Review of Financial Studies Vol. 34 No. 2 2021
Does Household Finance Affect the Political Process? Evidence from Voter Turnout During a Housing Crisis
Abstract
I examine the effect of house price declines on voter participation using a novel person-level panel data set. Contrary to what the “angry voter hypothesis” predicts, I find that a 10% decline in local house prices decreases the participation rate of the average mortgaged homeowner by 1.6 percentage points. Consistent with a financial distress channel, house price declines have no effects on renters and particularly severe effects on highly leveraged households. My findings are consistent with the existence of a feedback loop between financial distress and inequality operating through voter participation.
- DOI
- 10.1093/rfs/hhaa064
- Volume
- 34
- Issue
- 2
- Pages
- 949-984
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref