The Patient Protection & Affordable Care Act’s Impact on Household Formation

The Undergraduate Research Program gives me the opportunity to study an important topic in macroeconomics. Young adults have historically been active in the market for homes. The Patient Protection & Affordable Care Act’s (PPACA) dependent coverage provision (DCP), allows young adults up to age 28 to stay on their dependent’s health plans if the insurance company offers them, Dr. Colman and I suspect this might alter the rate of household formation amongst younger adults.

To that end, Dr. Colman and myself are researching this theory to determine if indeed it does, and to what effect, and what might be the ramifications going forward for the housing sector.

To determine this we will use an econometric technique known as ‘difference-in-differences’ which is used to the effects of a ‘treatment’ or an independent variable, on two groups, one control, and one exposed to the treatment variable. We will be utilizing data from the National Institutes of Health Survey compiled by the CDC. The survey has a response rate of nearly 90%, making it an adequate cross-section of the United States.

This project grants me a unique opportunity to participate in research that might ordinarily be conducted at the post-graduate level and will serve as excellent preparation for graduate study in economics.

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