"Are Asset Prices Sticky?'' (with Martin Schmalz and Dag Einar Sommervoll)
We use an unexpected and geographically confined, and persistent increase in residential electricity prices to shock the fundamental value of a large cross section of homes and investigate the presence of price stickiness in residential real estate market. The resulting decline in the fundamental value of homes provides an ideal setting to examine whether asset prices adjust fully or sluggishly to new information. Using a difference-in-differences framework, we find that home prices declined by approximately 4% to 6\% following the shock, while sales volume fell by 9% to 10\%. The volume drop is driven by fewer listings, longer time on market (TOM), and more unsold inventory, consistent with price rigidity. Our findings support the hypothesis of asset price stickiness and suggest frictions in the housing market impede full price adjustment. [Slides]
"Employment and earnings losses in a green transition: Lessons from the oil industry'' (with Elisabeth Isaksen and Maria Nareklishvili)
This paper investigates the employment and earnings impacts of a green transition, leveraging the 2014 oil price shock as a natural experiment to examine labor market consequences from a contraction of Norway's fossil fuel industry. Using matched employer-employee data and a difference-in-differences design, we find that oil workers experienced a 6.3% decline in annual earnings and a 4.3% drop in employment within four years of the shock. An event study design reveals that displaced oil workers faced an 18% decline in labor earnings, 15.8% reduction in employment, and 6.9% decrease in hourly wages relative to comparable non-oil workers. Despite limited reallocation to green jobs, oil workers who transitioned to green sectors represented a similar share of the destination workforce as those who moved to brown (non-oil) sectors. While workers entering green jobs experienced larger earnings losses than those entering brown jobs, their losses were smaller than for those moving to other jobs. Analyzing earnings differentials, we find that lower establishment wage premiums, rather than skill distance or worker sorting, primarily drive these disparities.
"Household response to an electricity price shock" (with Elisabeth Isaksen)
Using monthly-level household electricity consumption data and a spatial regression discontinuity design, we investigate households' response to an unexpected, geographically confined, and long-lasting change in residential electricity prices.
"Aggressive Bidding in Housing Auctions" (with Andreas E. Eriksen, Plamen Nenov, and Nadav Tadelis)
Using data on more than one million bids, we characterize the occurrence of aggressive bidding in housing auctions.