Brown Bag Seminar - Hamed Ghoddusi
Wir freuen uns, für Mittwoch, 14. März 2018, ein Brown Bag Seminar mit Hamed Ghoddusi (Stevens Institute of Technology) ankündigen zu können.
Hamed Ghoddusi wird sein Paper "Mortgage Interest Tax Deductibility under Uncertainty", (gemeinsam mit Mohamad Afkhami (Stevens Institute of Technology) vorstellen.
Die Veranstaltung findet in Raum D5.1.003 von 12:00-13:00 statt.
Abstract: The effective tax shield value of the mortgage interest deductibility (MID) can be significantly lower than what it may seem in the presence of standard deductions. We use a continuous-time contingent claiming framework to quantify the tax shield value of MID under uncertainty. Our pay-off model identifies convexities and concavities in the relationship between the effective mortgage interest tax deduction and a set of the underlying variables including the level and volatilities of household income, house price, and local and state tax rates. The model is simulated for a range of realistic household characteristics. Using the quantitative model we compare the relative attractiveness of an Adjustable Rate Mortgage (ARM) versus a Fixed Rate Mortgage (FRM), and demonstrate an inverse U-shape relation between the tax shield of the two types of mortgages and the household income. We find several inverse-U relationships between the volatility of underlying variables and the present value of the MID. We also offer some preliminary empirical results supporting the theoretical model.
zurück zur Übersicht