Abstract
After the global financial crisis, more and more research at home and abroad have focused on the impact of the real estate market on consumer spending. This paper reviews the research results of domestic and foreign scholars on the wealth effect of real estate, and finds that no matter based on macro or micro data, the relevant domestic research has not given a more consistent conclusion that the wealth effect of the real estate market. Some people hold that the housing wealth effect is positive in China, while others hold that the housing wealth effect is negative in China. This paper sorts out those and tends to support the conclusion that the wealth effect of China’s real estate market is negative. Then, based on the perspective of transmission mechanism, this paper makes a reasonable explanation, and finally puts forward some corresponding feasible policy recommendations to promote the positive wealth effect of the real estate market.
Highlights
As an important part of the aggregate demand—consumption, the fluctuation of its expansion or contraction will have an important impact on macroeconomic operations
Focusing on the real estate market, deflation will lead to an increase in the real value of properties and generate a positive wealth effect that would be channeled into more consumption
Most of the data used in domestic research from a macro perspective are national total time series or inter-provincial panel data, subject to differences in data limitations and model selection, but the results are quite different. Such as Gao Chunliang, Luo Yuyan and Liu Dan based on macro data, found the real estate wealth effect is not obvious; The research of Zhang Hong, Song Bo, Wang Zilong et al showed that the real estate market in China has a positive wealth effect
Summary
As an important part of the aggregate demand—consumption, the fluctuation of its expansion or contraction will have an important impact on macroeconomic operations. The wealth effect of the impact of assets on consumption has always been the focus of academic and economic decision-making institutions in the world. Research on wealth effects at home and abroad focused on the impact of financial wealth on household consumption and less on housing assets. W. Bao cial institutions, resulting in a sharp decline in consumer confidence and consumption capacity, causing economic recession. Bao cial institutions, resulting in a sharp decline in consumer confidence and consumption capacity, causing economic recession The outbreak of this crisis has made the domestic and international theoretical circles pay more attention to the wealth effect of the real estate market. Most empirical studies in developed economies have basically confirmed that the rise of real estate wealth has a positive and significant effect on household consumption, and has a much larger wealth effect than the stock market.
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