The Impact of Airbnb on Housing Affordability, joint with Wen Wang (work in progress)
In recent years, peer-to-peer accommodation platform Airbnb has developed into a major player in the short-term rental market. While some local governments and community leaders blame Airbnb for driving up rent in the long-term rental market, Airbnb argues that the platform helps many families stay in their houses. Although the actual effect of Airbnb on housing affordability is still unclear, regulations on Airbnb in some cities have already been enacted. In this paper, we develop a model of hosts' exit and entry decisions. The model considers three types of hosts: share their apartments with others, rent out their apartments when they are away and rent out their apartments like small hotels. With the model estimates, we explore the impacts of two popular regulations: cap on rental nights and ban on certain apartment types.
Credit Rating Stability and Quality with Multiple Credit Rating Agencies, joint with Wei Tan
In this paper, we model the credit rating firm's rating decision in a dynamic discrete choice framework. The rating firm decides when to revise the rating of a bond in order to minimize the reputation cost. And we allow serially correlated unobservables in our model -- the underlying rating of a bond is known by the firm but not by the researcher. We empirically estimate the parameters of the structural model using the mortgage-backed security bond data from 2004-2007. In the counterfactual analysis, we evaluate the effects of competition on the accuracy of credit ratings.