How does immigration affect housing costs in Switzerland?

Swiss Journal of Economics and Statistics

Table 10 Housing prices and immigration—cantons from 1998–2016: Sensitivity analysis.

	Baseline	One year lag	3-year diff.	Net mig.	\(\leqslant 20\%\) sec. homes	2002–2016
	(1)	(2)	\((3)^{1}\)	\((4)^{2}\)	\((5)^{3}\)	(6)
OLS regressions
Dep. var.: \(\Delta \, \text {ln} \, HP_{it}\)
\(\beta _1\)	1.881**	1.775***	2.242***	1.516**	1.856**	1.639**
	[0.011]	[0.009]	[0.009]	[0.012]	[0.028]	[0.019]
Dep. var.: \(\Delta \, \text {ln} \, AP_{it}\)
\(\beta _1\)	1.097*	1.374**	1.398	1.697***	1.317*	1.313**
	[0.073]	[0.044]	[0.101]	[0.005]	[0.072]	[0.026]
Dep. var.: \(\Delta \, \text {ln} \, RP_{it}\)
\(\beta _1\)	2.387***	1.793*	2.650***	2.085***	2.680***	2.865***
	[0.006]	[0.071]	[0.004]	[0.001]	[0.009]	[0.006]
IV regressions
Dep. var.: \(\Delta \, \text {ln} \, HP_{it}\)
\(\beta _1\)	3.865	3.146	4.602*	1.290*	4.199	4.100
	[0.115]	[0.200]	[0.060]	[0.094]	[0.177]	[0.164]
Dep. var.: \(\Delta \, \text {ln} \, AP_{it}\)
\(\beta _1\)	6.285	5.373	7.278	2.097	8.057	6.365
	[0.319]	[0.148]	[0.264]	[0.306]	[0.176]	[0.248]
Dep. var.: \(\Delta \, \text {ln} \, RP_{it}\)
\(\beta _1\)	7.407**	5.403	7.665*	2.218**	10.321**	8.045**
	[0.037]	[0.113]	[0.052]	[0.043]	[0.033]	[0.029]
Obs, HP & AP	442	442	442	442	357	390
Obs, RP	427	427	427	427	342	375
K-P F-stat, HP & AP	21.98	35.68	46.30	182.99	15.33	19.57
K-P F-stat, RP	16.91	28.52	38.81	178.09	9.89	14.58

p values in brackets. Standard errors clustered by cantons are estimated by the wild bootstrap. The regressions are run at the cantonal level for the period from 1998–2016, except in column 6. \(\Delta\) indicates first differences. \(\beta _1\) is the estimated coefficient on the annual immigration (\(\Delta I_{it}\)) relative to the initial population size (\(Pop_{it-1}\)). All regressions include year fixed effects and the annual change in the unemployment rate lagged by one year as a control variable. The instrument is the change in the predicted stock of foreigners divided by initial population. The stock of foreigners is predicted by the settlement pattern of immigrants in 1980. In columns 2, the instrument is likewise lagged by one year. The K-P F-stat is the Kleibergen-Paap rk Wald F-statistic
\(^{1}\) In column 3, a 3-year difference is applied to all variables, e.g.: \(\text {ln} \, HP_{it} - \text {ln} \, HP_{it-3}\) or \((I_{it} - I_{it-3})/Pop_{it-3}\)
\(^{2}\) In column 4, international net migration of foreigners is used instead of the annual change in the stock of foreigners to measure \(\Delta I_{it}\)
\(^{3}\) In column 5, only cantons with a share of second homes of 20% or less are considered for the estimation
Significance levels: \(^{*}\) \(p<0.10\), \(^{**}\) \(p<0.05\), \(^{***}\) \(p<0.01\)