Ashlyn Aiko Nelson

Liar’s Loan? Effects of Origination Channel and Information Falsification on Mortgage Delinquency

This paper presents an analysis of mortgage delinquency between 2004 and 2008 using a loan-level data set from a major national mortgage bank. Our analysis highlights two problems underlying the mortgage crisis: a reliance on mortgage brokers who tend to originate lower-quality loans and a prevalence of low-documentation loans—known in the industry as “liars loans”—that result in borrower information falsification. While over three-quarters of the difference in delinquency rates between bank and broker channels can be attributed to observable loan and borrower characteristics, the delinquency difference between full- and low-documentation mortgages is due to unobservable heterogeneity, about half of it potentially due to income falsification.

Securitization and Loan Performance: A Contrast of Ex Ante and Ex Post Relations in the Mortgage Market

This study presents an intriguing contrast of the ex ante and ex post relations between mortgage securitization and loan performance using a comprehensive dataset from a major national mortgage lender. While the paper supports that the bank applies lower screening efforts on loans that have higher ex ante probability of being securitized, it further shows that loans remaining on the bank’s balance sheet are, ex post, of worse quality than sold loans. Most of the delinquency difference can be explained by secondary market investors’ information advantage over the originating bank acquired over the time lag between loan origination and loan sale. While many blame the presence of the secondary market for creating demand for low-quality loans, we find that ironically these loans hurt the originating bank more than they did the secondary market.

The Rise of School-Supporting Nonprofits.

This paper examines voluntary contributions to public education via charitable school foundations, booster clubs, parent teacher associations, and parent teacher organizations. We use panel data on school-supporting charities with national coverage from 1995 to 2010, which we geocode and match to school districts. We document the meteoric rise of school-supporting nonprofits during this panel, and then estimate a series of regression models to examine the distributional consequences of voluntary contributions. We find relatively large districts have higher probabilities of receiving revenues from a school-supporting nonprofit but the level of per-pupil voluntary contributions declines with student enrollment. In addition, we find school districts with higher endowments have higher probabilities of being served by at least one school-supporting nonprofit and higher levels of per-pupil contributions. Finally, we find no evidence that impressive recent growth in the number and financial size of these school-supporting charities relates to reductions in the public financing of schools. © 2014 Federal Reserve Bank of New York

Secondhand Smoke Exposure in Cars and Rooms: Trend Comparisons Among Subpopulations of Nonsmoking U.S. Middle and High School Students

INTRODUCTION Young people in the United States are exposed to secondhand smoke (SHS) primarily in 2 settings: homes and cars. Recently, researchers reported that the prevalence of U.S students exposed to SHS in cars decreased from 2000 to 2009; however, comparisons of trends across school levels, gender, and racial/ethnic groups were not assessed. Moreover, no studies have examined trends of exposure to SHS in rooms. METHODS We used data from the 2000, 2002, 2004, 2006, and 2009 waves of the National Youth Tobacco Survey, a nationally representative cross-sectional survey of U.S. middle and high school students. For SHS in cars and rooms, we identified exposure trends among nonsmokers from 2000 to 2009 and compared trends across subpopulations with binary logistic regression. RESULTS We identified significant downward linear trends in SHS in cars and rooms for nearly all measured subpopulations of nonsmoking students from 2000 to 2009. SHS exposure in cars and rooms declined at a significantly greater rate for males than for females. SHS exposure in cars declined at a significantly greater rate for non-Hispanic (NH) Blacks than for NH Whites. SHS exposure in rooms declined at a significantly greater rate for NH Whites than for Hispanics and Native Hawaiians/Pacific Islanders. CONCLUSIONS Although prevalence of exposure to SHS in cars and rooms among nonsmoking U.S. middle and high school students has declined from 2000 to 2009, the rates of decline were not equal across genders and racial/ethnic groups. Identification of these differing rates of exposure can help the public health community advocate for interventions focused on reducing adolescent SHS exposure.

Secondhand smoke exposure and other correlates of susceptibility to smoking: A propensity score matching approach

Secondhand smoke (SHS) exposure is responsible for numerous diseases of the lungs and other bodily systems among children. In addition to the adverse health effects of SHS exposure, studies show that children exposed to SHS are more likely to smoke in adolescence. Susceptibility to smoking is a measure used to identify adolescent never-smokers who are at risk for smoking. Limited research has been conducted on the influence of SHS on susceptibility to smoking. The purpose of this study was to determine a robust measure of the strength of correlation between SHS exposure and susceptibility to smoking among never-smoking U.S. adolescents. This study used data from the 2009 National Youth Tobacco Survey to identify predictors of susceptibility to smoking in the full (pre-match) sample of adolescents and a smaller (post-match) sample created by propensity score matching. Results showed a significant association between SHS exposure and susceptibility to smoking among never-smoking adolescents in the pre-match (OR=1.47) and post-match (OR=1.52) samples. The odds ratio increase after matching suggests that the strength of the relationship was underestimated in the pre-match sample. Other significant correlates of susceptibility to smoking identified include: gender, race/ethnicity, personal income, smoke-free home rules, number of smoking friends, perception of SHS harm, perceived benefits of smoking, and exposure to pro-tobacco media messages. The use of propensity score matching procedures reduced bias in the post-match sample, and provided a more robust estimate of the influence of SHS exposure on susceptibility to smoking, compared to the pre-match sample estimates.

The Effect of Tax and Expenditure Limitations on Voluntary Contributions to Public Schools

This paper is the first to examine the effects of tax and expenditure limitations (TELs) on charitable activities benefiting public schools. Because TELs aim to reduce state budgets, TEL adoption may induce voluntary collective action at the local level. This paper employs a quasi-experimental difference-in-differences strategy and finds no causal evidence that TELs either increase the probability that a school-supporting nonprofit locates within a district, or increase the level of voluntary contributions to public schools. The findings highlight a growing evidentiary base demonstrating that local action — including via philanthropic activity — cannot offset policies aimed at reducing government budgets.