Home equity and labor income: The role of constrained mobility

Radhakrishnan Gopalan, Barton H. Hamilton, Ankit Kalda, David Sovich

Research output: Contribution to journalArticlepeer-review

2 Scopus citations


Using detailed data for U.S. homeowners, we document a negative, nonlinear relation between the loan-to-value ratio (LTV) of homeowners' primary residence and their labor income. Consistent with high LTV individuals experiencing constrained mobility, we find stronger effects among subprime, liquidity- constrained individuals and those living in regions with limited alternative local employment opportunities and strict noncompete law enforcement. Though high LTV individuals are less likely to move across MSAs, they are more likely to change jobs without changing their residence. We find no effects among similar neighboring renters employed at the same firm and with a similar job tenure.

Original languageEnglish
Pages (from-to)4619-4662
Number of pages44
JournalReview of Financial Studies
Issue number10
StatePublished - Oct 1 2021

Bibliographical note

Publisher Copyright:
© The Author(s) 2020.

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics


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