Code for: Do People Respond to the Mortgage Interest Deduction? Quasi-Experimental Evidence from Denmark

Principal Investigator(s):  View help for Principal Investigator(s) Jonathan Gruber, MIT; Amalie Jensen, Princeton University; Henrik Kleven, Princeton University

Version:  View help for Version V1

Name File Type Size Last Modified
Check homeowner measure.do text/x-stata-syntax 4 KB 04/20/2020 12:05:AM
Cross-country analysis.do text/x-stata-syntax 13 KB 06/22/2020 12:34:AM
DD analysis sample.do text/x-stata-syntax 15.4 KB 04/17/2020 08:56:AM
DD graph data.do text/x-stata-syntax 19.2 KB 04/17/2020 07:53:AM
DD graphs.do text/x-stata-syntax 38.1 KB 04/17/2020 08:57:AM
DD tables.do text/x-stata-syntax 16.6 KB 04/17/2020 07:55:AM
Full population time series.do text/x-stata-syntax 3.4 KB 04/17/2020 07:44:AM
Generate data.do text/x-stata-syntax 3.9 KB 04/17/2020 07:55:AM
MTR graphs.do text/x-stata-syntax 3 KB 04/17/2020 08:51:AM
MTR_data.dta application/x-stata 3.8 KB 09/14/2019 09:44:AM

Project Citation: 

Gruber, Jonathan, Jensen, Amalie, and Kleven, Henrik. Code for: Do People Respond to the Mortgage Interest Deduction? Quasi-Experimental Evidence from Denmark. Nashville, TN: American Economic Association [publisher], 2021. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2021-04-07. https://doi.org/10.3886/E119157V1

Project Description

Summary:  View help for Summary
Using a major reform which scaled back the mortgage interest deduction for middle- and high-income households in Denmark, we study how tax subsidies affect housing decisions. We present four main findings. First, the mortgage deduction has a precisely estimated zero effect on homeownership for high- and middle-income households. Second, the mortgage deduc- tion has a clear effect on housing demand at the intensive margin, inducing homeowners to buy larger and more expensive houses. Third, the deduction has sizeable effects on household financial decisions, inducing them to increase indebtedness. Finally, the reduction of the tax subsidy lowered equilibrium house prices.

Scope of Project

JEL Classification:  View help for JEL Classification
      H20 Taxation, Subsidies, and Revenue: General
      H24 Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
      R21 Urban, Rural, Regional, Real Estate, and Transportation Economics: Housing Demand
Time Period(s):  View help for Time Period(s) 1980 – 2017
Collection Date(s):  View help for Collection Date(s) 1980 – 2017
Universe:  View help for Universe The population of Denmark, age 20-80. 
Data Type(s):  View help for Data Type(s) program source code

Methodology

Data Source:  View help for Data Source Danish administrative data, 1980-2017. 
Unit(s) of Observation:  View help for Unit(s) of Observation Individuals

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Published Versions

V1 [2021-04-07]

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