Heinz Alumni Discuss Research in Innovation and the Foreclosure Crisis at Washington Colloquium Panel
Dec 07, 2012
Three alumni recently joined the Heinz College’s Washington Colloquium at the Carnegie Endowment for National Peace in Washington D.C. for a panel on applied policy research for students. The panelists shared their experiences with recent research on several topics related to the U.S. economy in the wake of the Great Recession.
Brittany Bond (MSPPM ’10) is an Economist with the Economic and Statistics Administration (ESA) of the U.S. Commerce Department. Brittany described her work on a recent joint project between the ESA and the United State Patent and Trademark Office. Innovation promises to be a key factor in rebuilding U.S. economic growth, but myriad policy problems and opportunities will need to be navigated moving forward. To lay a framework for thinking through the options, this project identified first tier intellectual property intensive industries in the United States by linking industries to the patents, trademarks, and copyrights they generate. Seventy-five intellectual property intensive industries were identified, which as a group had faster employment growth during the recent economic recovery, accounted for 34.5% of 2010 GDP, and which had a wage premium of 42% higher than non-IP-intensive jobs. More findings from the project can be found in the recent report, Intellectual Property and the U.S. Economy: Industries in Focus, see: http://www.uspto.gov/news/publications/IP_Report_March_2012.pdf.
Francisca Winston (MSPPM ’05) is a Research Associate for the Local Initiatives Support Corporation (LISC),a long standing non-profit organization and community development financial institution that provides project support, programming, research, technical assistance, and lending for community development. One of the greatest wounds inflicted on the nation by the sub-prime mortgage crisis and the recession that followed was the foreclosure crisis. The ensuing wave of foreclosures not only hurt communities in rust belt cities that had already been struggling with urban blight for decades but threatened to “metastasize” blight into new communities in these cities and others across the nation. This situation presents a dilemma for urban areas in deciding which communities to focus assistance on and how. LISC partnered with the Urban Institute and the Center for Housing Policy to create foreclosure-response.org, an online guide to foreclosure prevention and neighborhood stabilization. Francisca described her work in helping to develop a housing market index and foreclosure risk impact scores for this effort. The market index is based on factors such as housing price, velocity of investment per unit, and the percentage of “high cost” mortgages in the area. The foreclosure risk scores were developed to help target funds for prevention and stabilization, and includes factors such as loan characteristics and vacancy rates. Together these measures were used helped identify strong and weak housing markets with high or low foreclosure risk in the D.C. metro area, with each case calling for different community investment strategies.
After graduating from the MSPPM program in 2003, Shannon McKay went on to earn a PhD at MIT’s School of Planning and Urban Studies. Dr. McKay serves as Research Analyst with the Federal Reserve Bank of Richmond. As the foreclosure crisis unfolded, multiple public initiatives were implemented to stem the tide. At the federal level, the Obama administration launched the Making Home Affordable (MHA) initiative in 2009 with a goal of assisting 3-4 million homeowners by 2012. Twelve Federal Reserve banks, including Richmond, launched the Mortgage Outreach and Research Efforts (MORE) initiative later that same year. Under this umbrella, the Federal Reserve Banks provided support for foreclosure prevention assistance to homeowners in need and also conducted research on foreclosure and housing-related issues in general. Dr. McKay worked on one such research project. This project focused on homeowners facing foreclosure who sought assistance from their lenders. The homeowners were contacted at one of four foreclosure prevention events held in Maryland and Virginia between 2009 and 2010. Study participants completed a short survey at these events, and three follow up surveys over the next two years. This data was combined with other data sets on property values and foreclosure notices. Regression analysis indicated that homeowners who received assistance were more likely to successfully avoid foreclosure. However, the loan-to-value ratio of the mortgage and adverse shocks experienced by homeowners, including loss of jobs and health problems, continued to be important predictors of default even in the presence of assistance.
Student questions and comments covered a range of topics, including the need to protect U.S. IP more aggressively with China, the need to engage communities in the unfolding of difficult reinvestment decisions in blighted areas. The panel was hosted by Heinz College D.C. and sponsored by the College’s Center for Economic Development. The CED’s Greg Lagana served as moderator.
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