Template-Type: ReDIF-Paper 1.0
Author-Name: Chunping Liu
Author-Name: Zhirong Ou
Title: What determines China's housing price dynamics? New evidence from a DSGE-VAR
Abstract: We investigate what determines China's housing price dynamics using a DSGE-VAR estimated with priors allowing for the featured operating of normal and 'shadow' banks in China, 
with data observed between 2001 and 2014. We find that the housing demand shock, which is the essential factor for housing price bubble to happen, accounts for over 80% of the housing price fluctuation. 
We also find that a prosperous housing market could have led to future economic growth, though quantitatively its marginal impact is small. But this also means that, 
for policy-makers who wish to stabilise the housing market, the cost on output reduction would be rather limited. 
File-URL: http://www.ntu.ac.uk/__data/assets/pdf_file/0035/349298/chunping-liu-working-paper-4.pdf
File-Format: Application/pdf
File-Function: First version, 2017
Creation-Date: 2017-04
Classification-JEL: C11, E32, E44, R31
Keywords: Housing price, Bubbles, Market spillovers, DSGE-VAR, China
Handle: RePEc:nbs:wpaper:2017/04