L. Rachel Ngai


Sichuan, China


London School of Economics, CFM and CEPR.

Curriculum Vitae   Email: L.Ngai"at"lse.ac.uk

Downloadable Working Papers

·      The decision to move house and aggregate housing-market dynamics (with Kevin Sheedy). May 2017.  (VoxEU Column ). CFM 2016-21


Previous title "Moving House". CEPR DP10346.

Abstract: Using data on house sales and inventories, this paper shows that housing transactions are driven mainly by listings and less so by transaction speed, thus the decision to move house is key to understanding the housing market. The paper builds a model where moving house is essentially an investment in match quality, implying that moving depends on macroeconomic developments and housing-market conditions. The endogeneity of moving means there is a cleansing effect | those at the bottom of the match quality distribution move first | which generates overshooting in aggregate variables. The number of transactions has implications for welfare because each transaction reduces the degree of mismatch for homeowners. The model is applied to study the housing market boom and the effects of transactions taxes.


·      Taxes and Mark Hours: the role of gender and skill  (with Robert Duval-Hernandez and Lei Fang). May 2017.


        Online Appendix -- Proofs and calibration procedures


Abstract: Using micro data from 17 OECD countries, this paper documents that cross-country difference in aggregate market hours is mainly due to market hours of women, especially low-skilled women. Based on a multi-sector model with both gender and skill dimensions, the paper shows that taxes and social subsidies on family care can account for a substantial fraction of the observed cross-country differences in market hours by gender and by skill. The model predictions are also largely consistent with cross-country patterns in home hours, leisure, sectoral hours, and gender wage gaps. Both substitution margins across work and leisure and across market and home are important. Taxes operate through both margins while social subsidies operate mainly through the second margin. The first margin affects all population groups while the second margin affects mostly women.


·      China's mobility barriers and employment allocations (with Chris Pissarides and Jin Wang). November 2016. CEPR DP11657.


Abstract: China.s hukou system imposes two main barriers to population movements. Agricultural workers get land to cultivate but run the risk of losing it if they migrate. Social transfers (education, health, etc.) are conditional on holding a local hukou. We show that the land policy is a more important barrier on industrialization. This distortion can be corrected by giving property rights to farmers. Social transfers dampen mainly urbanization. We calculate that the two policies together lead to overemployment in agriculture of 6.7 points, under-employment in the urban sector of 6.3 points and have practically no impact on the rural non-agricultural sector.


·      Ins and Outs of Selling Houses (with Kevin Sheedy), September 2015.  

Abstract: This paper documents the cyclical properties of housing-market variables (sales, new listings, time-to-sell, the number of houses for sale, and prices), which are shown to be volatile, persistent, and highly correlated with each other. Is the observed volatility in these variables due to changes in the speed at which houses are sold (outflow rate) or changes in the number of houses that are put up for sale (inflow rate)? An inflow-outflow decomposition shows that the inflow rate accounts for almost all of the fluctuations in sales volume. The paper then shows that a search-and-matching model with endogenous moving subject to housing demand shocks performs well in explaining fluctuations in housing-market variables. A housing demand shock induces more moving (acting like a moving-rate shock) and increases the supply of houses on the market (acting like a housing supply shock), thus one housing demand shock replicates three correlated reduced-form shocks that would be needed to match the relative volatilities and correlations among key housing-market variables.

·      Gender Gaps and the Rise of the Service Economy (with Barbara Petrongolo). January 2017. American Economic Journal -- Macroeconomics, forthcoming.


       Previous title "Structural Transformation, Marketization and Female Employment".  CEP DP1204.

Keywords: gender gaps, structural transformation, home production, rise in female market hours, fall in male market hours, rise in gender wage ratio




·         Barriers and the Transition to Modern Growth, Journal of Monetary Economics, October 2004, Volume 51, Issue 7, p. 1353-1383.

Keywords: cross-country income differences, stagnation to growth, transitional dynamics.


·         Structural Change in a Multisector Model of Growth (with Chris Pissarides), American Economic Review, March 2007, Volume 97, No. 1, p. 429-443.

A longer working paper version: CEPR DP 4763. Previous title: "Balanced Growth with Structural Change".

Keywords: multi-sector growth model, structural change (Kuznets' facts), aggregate balanced growth path (Kaldor's facts)  


·         Public Enterprises and Labour Market Performance (with Johannes Hörner and Claudia Olivetti), International Economic Review, May 2007, Volume 48, No. 2, p. 363-384.

Keywords: Unemployment, public sector employment, economic turbulence


·        Trends in Hours and Economic Growth (with Chris Pissarides), Review of Economic Dynamics, April 2008, Volume 11, p. 239-256. 

Previous Title: "Trends in Labour Supply and Economic Growth"

Keywords: structural transformation, marketization, home production, trends in aggregate market hours, aggregate balanced growth path.


·        Mapping Prices into Productivity in Multisector Growth Models (with Roberto Samaniego), Journal of Economic Growth, September 2009, Volume 14, p.183-204.    

Keywords: input-output table, intermediate goods, investment-specific technical change (ISTC).


·        Accounting for Research and Productivity Growth Across Industries (with Roberto Samaniego), Review of Economic Dynamics, July 2011, Volume 14, p. 475-495.        

Keywords: cross-industry productivity growth, endogenous growth model, R&D.


·      Taxes, Social Subsidies and the Allocation of Work Time  (with Chris Pissarides), American Economic Journal - Macroeconomics, October 2011, 3(4): 1-26.

   Previous title: "Welfare Policy and the Sectoral Distribution of hours of Work".

Keywords: time allocation, home production, welfare policy (taxes and subsidies), 19 OECD countries


·          Hot and Cold Seasons in the Housing Market (with Silvana Tenreyro). (Web Appendix), American Economic Review, December 2014, 104(12): 3991-4026.

- Featured in Financial Times - FT Weekend Magazine (pdf)

Keywords: seasonality, the U.K. and the U.S. housing markets, match-specific quality, thick-market effect.

Last update: May 2017