Jenny Gu - Research Insights

Jenny Gu, Satish & Yasmin Gupta College of Business

Jenny Gu"Mortgage Loan Securitization and Personal Consumption Smoothening"

In the Author's Words

In this paper we examine the extent to which personal consumptions are sheltered from state-specific economic shocks because of banks’ mortgage loan securitizations. We posit that securitization contributes to personal consumption smoothening due to securitizations’ positive effect on banks’ credit supply, which reduces consumers’ consumption constraints during economic shocks. Using data for U. S. banks’ mortgage loan securitizations from 1989 to 2008, we show that personal consumption smoothening is positively related to securitization. The finding of a significant relationship between loan securitizations and consumption smoothening contributes to the continuing debate on the role of financial innovation in real economy.

Gu, J., Hernandez, R., Liu, P., & Shao, Y. (2015). Mortgage Loan Securitization and Personal Consumption Smoothening. Journal of Economics and Finance. “lead article” in issue.

Faculty Profile: Jenny Gu

News

When Foresight Is 20/20: Endowment Gains 27 Percent in One Stroke Thanks to $10 Investment 24 Years Ago

At a time when many small liberal arts universities are struggling, the University of Dallas has some good news to offer: The strategic sale of the apartment complex owned by the university for 24 years has increased the endowment by nearly 27 percent, or $16 million, bringing the current value to over $76 million. Further, this increase is predicted to eventually generate an additional $800,000 annually for UD's operations, capital and maintenance budgets.

+ Read More