by Stephen Malpezzi, Department Chair, Professor and Lorin and Marjorie Tiefenthaler Distinguished Chair in Real Estate
Recently we received the sad news that Berkeley’s Professor John Michael Quigley passed away on May 12, 2012. John was a professor of economics, public policy, and real estate at the University of California-Berkeley. Information about Professor Quigley’s life and work can be found at Berkeley’s Goldman School of Public Policy.
You’ll find other postings at the American Real Estate and Urban Economics Association, the Regional Science Association, and by some of his former students and other colleagues, such as Nils Kok, and Matt Kahn.
By the time I get this written and posted, there will doubtless be more tributes and postings, around the world. Let me take the liberty of adding to these, with a few of my own remembrances.
I first encountered Professor Quigley through his research; later, we connected through our mutual friend the late Steve Mayo. I was honored to count John as a friend, but he was also a professional and scholarly inspiration to me, and to many, many others. Professor Quigley was an active researcher and teacher for over four decades; a long career by some standards, but he left those of us who knew him, and his work, wishing we could have had a fifth, if not a sixth.
In the history of the allied fields of urban economics, real estate economics and finance, after the original generation of William Alonso, Richard Muth, Edwin Mills and John Kain, John Quigley shaped our field like no one else. The breadth of his contributions, in urban, housing, public finance, finance, and many other fields, is breathtaking.
I’m not alone in that judgment, and those of us that hold it can easily show that it’s not simply sentiment for a passed friend. Many colleagues share my high opinion of John Quigley, and have said so, unbidden, for years, long before his illness. Several years ago, for fun, I asked six PhD students to write down the name of the person who, according to their study, all-in, made the greatest contributions to our field. (I told them they couldn’t name anyone from Wisconsin, but of course that was to save face :-).
Five wrote “Quigley.” Well, it wasn’t all six, but I’m not going to stretch the truth for the sake of the story!
John wrote many books and articles, about 200 if you include his reviews and shorter policy pieces (which, if you read a few, you will!). But the most amazing thing about his work wasn’t the quantity, so much as the consistent quality. I can’t begin to do his corpus justice, but let me touch on just a few of my personal favorites.
I started my career in 1977, analyzing housing markets at the Urban Institute. One of my “bibles” that I constantly consulted, both for specific results and, more importantly, as a clear model of how to undertake rigorous scholarship in my new field, was John’s 1975 book with his former major professor John Kain, Housing Markets and Racial Discrimination. Written several years after the racial strife of the late 60s, it’s a masterpiece of data collection, analysis, and clear and careful thinking.
John’s 1997 Presidential Address to the American Real Estate and Urban Economics Association, “Urban Diversity and Economic Growth,” still stands as one of the clearest expositions of the reasons why cities exist, and why they are so important.
Much of my policy work is focused on how the housing market works (or, sometimes, doesn’t) for low-income citizens. But the first paper I refer anyone new to the subject isn’t one of my own – it’s Quigley’s superb paper “Is Housing Affordable? Why Isn’t It More Affordable?,” written with Steven Raphael.
I’ve been very focused in recent years on supply side issues, particularly regulation. John did some of the early work, and lately some of the best. See, for example, his paper with Nils Kok and Paavo Monkkonen, “Geography, Regulation and the Value of Land.”
Understanding housing market dynamics is a major part of today’s research agenda; see, for example, some of the recent HULM programs put together by my colleagues Morris A. Davis and Erwan Quintin. But John was an “early adopter” of the dynamic view, as you’ll see, for example, in a 1979 paper with his friend Ric Hanushek, “The Dynamics of the Housing Market: A Stock-Adjustment Model of Housing Consumption.”
Mortgage securities, especially residential, contain some features that make them very challenging to analyze, compared to many other fixed income products; in particular, analyzing them correctly requires an understanding of both prepayment risk and default risk, and their interaction. Quigley and his former student Professor Yongheng Deng developed the competing risk model that is now a standard for studying MBS; see their paper “Mortgage Terminations, Heterogeneity and the Exercise of Mortgage Options.”
Professor Quigley and his good friend Chip Case and the noted financial economist Bob Shiller were among the first economists to warn of the risks inherent in the housing market boom of the late 90s and early 2000s, as in their prescient 2003 “Is There a Bubble in the Housing Markets?”
A later look, produced just as the boom ended, predicted much of the macroeconomic pain we’ve experienced as a consequence; see Case and Quigley’s “How Housing Booms Unwind: Income Effects, Wealth Effects, and Feedbacks through Financial Markets.”
John was always looking for new and interesting problems to work on, and in recent years he turned his attention to the intersection between environmental issues and real estate. One of several papers we could point to in this new area is his work with Piet Eicholtz and Nils Kok, “Doing Well by Doing Good? Green Office Buildings.”
Despite the length of this note, we’ve hardly scratched the surface of John’s research. He wrote many additional papers on the topics above, and worked on many other problems, including transportation, public finance, alternative methods of price index construction, labor markets, and the economics of crime.
Most of the papers I’ve cited above happen to focus on the U.S., but John worked with friends from around the world, writing a number of fine papers about Europe (especially but not limited to Sweden with friends including Peter Englund and the late Bengt Turner) and a number of papers about Asia. He was long a stalwart promoter of global real estate research and education; he long championed the international activities of the American Real Estate and Urban Economics Association.
John had legions of PhD students, and terrific ones at that. I would think that he’s had more impact through students than anyone in our field since his own mentor John Kain, and of course Edwin Mills.
One of the reasons I so enjoyed spending time with John was that in addition to his research, I admired and learned from his values. John was truly rigorous -- not the faux rigor of somebody who makes a problem complicated just for the sake of showing off some technical trick, but somebody who follows Einstein’s dictum, “Everything should be as simple as possible. But not more so.” John was a great mentor and teacher, certainly to his former “official” students, but even to those who, like me, were his students despite never having taken a class from him. He didn’t care about your academic “pedigree” or your rank or institution; he cared about what new ideas you brought to the table and the quality of your work. He was scrupulous about studying the literature in a new problem and was always generous in his recognition of the credit due to others.
Must I add the obvious, that another reason many of us loved his company is that he was so much fun to be around? For all these reasons, we’ll miss John deeply.
Photo by Genevieve Shiffrar, © UC Regents, used with permission