Financing housing and house prices in China
Journal of Financial Economic Policy
Emerald Group Publishing Ltd.
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Arestis, P., & Jia, M. (2020). Financing housing and house prices in China. Journal of Financial Economic Policy, 12 (4), 445-461. https://doi.org/10.1108/JFEP-04-2019-0072
Abstract Purpose This paper aims to examine the evolution of house prices in China and especially the effects of different financing channels on China’s house prices. Design/methodology/approach We employ our own theoretical framework and proceed to test the testable hypotheses by employing the Autoregressive Distributed Lag (ARDL) bounds test approach for cointegration analysis and the unrestricted error correction model (UECM). Quarterly time series data from Q1 2002 to Q2 2016 are utilised. Findings The results suggest that in the short run, bank loan to real estate development and scale of shadow banking have significant positive effects on house prices. In the long run, the scale of shadow banking and disposable income affect house prices positively and significantly. Originality This study provides more insights into how and to the extent different financing channels affect China’s house prices, particularly the impact of shadow banking on the house prices.
External DOI: https://doi.org/10.1108/JFEP-04-2019-0072
This record's URL: https://www.repository.cam.ac.uk/handle/1810/296092
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