So it is important that both households and mortgage institutions take account in their estimates of the possibility that interest rates will be higher in the future than at present. That also means that the rate of increase in house prices cannot be expected to remain as high in the long term as it is today. The consequences of this assessment of house price developments differ somewhat depending on which of the Riksbank’s two tasks we are talking about. As regards payment system stability, i.e. financial stability, I do not believe that house prices and household debt pose any threat at present. 2/6  The bulk of lending to households comprises loans secured on housing. A home is part of a household’s wealth and if the value of a home or apartment were to fall, it naturally would mean that the homeowner’s ability to pay would decrease. But the household’s income is not tied to the value of its home, and as long as the household is able to meet its borrowing costs, it does not represent a threat to the banks and the payment system. Both higher incomes and lower interest payments have resulted in a good ability to pay in the household sector at present.
9  7  Janet L. Yellen, “Recent Developments and the Outlook for the Economy,” Remarks at the City Club of Cleveland, July 10, 2015. 8  Paul Krugman, “The Myth of Asia’s Miracle,” Foreign Affairs, Vol. 73, November/December, pp. 62–78, 1994. 9  Enrico Moretti, The New Geography of Jobs, Mariner Books, 2013. 4  BIS central bankers’ speeches  For instance, the reason why Seattle, Washington, became a high-tech industry hub depended to a large extent on the fact that the founders of Microsoft had grown up there and wanted to relocate their company to a place familiar to them. Similar stories can be found for other U.S. high-tech cities. If these cases provide a complete explanation of productivity growth, all we can do is wait and hope for a genius like Bill Gates or Steve Jobs to be born by chance in our country. Fortunately, however, economic literature is much more hopeful in this respect: productivity is largely endogenous. IV. How to raise productivity  In the economic literature, there is a long list of factors that are thought to have a positive impact on productivity growth. I do not intend to go through all of them but, instead, I would like to focus on three things that I think are of particular importance. The first is human capital. Measuring human capital is a difficult task, but one of the simplest indicators often used is the number of school years.