The Effect of Wealth Shocks on Shirking: Evidence from the Housing Market

This paper studies the effect of housing wealth shocks on workplace shirking behavior. We use the type and actual time stamps of 10.6 million credit card transactions by over 200,000 cardholders from a large commercial bank to detect non-work-related behavior during work hours. After positive shocks to house prices, employed homeowners in the treatment group experienced a fast and persistent increase (by 19% per month) in their propensity to use work hours to attend to personal needs. The post-shock response is more pronounced among homeowners with a greater wealth increase, among employees with poorer career potential, or for occupations with higher monitoring costs. Our estimate implies an elasticity of shirking propensity with respect to house price of 3.8.