Market Rates Research Articles

Diferencial entre el €STR y el tipo de interés de la facilidad de depósito

Rationale This article analyses the factors that are contributing to the widening of the spread between the euro short-term rate (€STR) and the deposit facility rate, with a view to assessing monetary policy transmission in the Eurosystem. Takeaways •The key factors that explain the behaviour of this spread are the expansion of the Eurosystem’s balance sheet and the change in the monetary policy stance. •The pass-through of the recent interest rate hikes to money market rates has been effective and cannot explain the widening of the spread. •Once the rate hiking cycle comes to an end, the contraction in the Eurosystem’s balance sheet can be expected to curb or even reverse the trend observed in the spread.

Exploration of Dynamic Optimization Paths for Work Search Models under Incomplete Information Conditions

This article is based on the application exploration of dynamic optimization theory under incomplete information conditions. Based on the job search model and its extended model, this theory is analyzed in detail, explaining the relationship between unemployment rate and wages in the labor market, exploring the impact of Western labor unemployment formation, summarizing the experience of urban unemployment in the process of social construction in the new era, and developing high-quality and high-quality employment work for college students, It will have very important inspiration and reference significance.

The evolution of commercial finance in Ming-Qing China: 16th to Early-20th Centuries

Objective/Context: This article surveys the evolution of commercial finance in Ming-Qing China and responds to the debates about the role of finance in the “Great Divergence” between China and Europe. Methodology: Based on new historical materials, especially commercial documents, we study the evolution of financial organizations at different levels as delineated by Fernand Braudel. We also analyze the long-run trends of commercial interest rates in the Ming-Qing eras based on a novel historical database of interest rates in China. Originality: This article explores capital market developments since the 16th century and their relationship with the state —a topic that has been almost entirely neglected in the existing literature. We also find improvements in market integration in China before the late 19th century when Western financial institutions began to enter China, and the prime commercial interest rate in the capital market was much lower than the dominant accounts in the “Great Divergence” debate. Conclusions: While current comparative studies either emphasize the financial stagnation of Ming-Qing China relative to the West or emphasize its special development through non-market mechanisms, e.g., clans, this article shows that the capital market played a similar key role in the evolution of finance in Ming-Qing China as it did in advanced parts of Europe. Thus, we suggest that the difference in financial development between China and the West lies in the organizational structure of the financial sector and the relationship between finance and the state.

Determinants of increasing the rating of the Republic of Kazakhstan stock market in the current conditions of uncertainty

International rating agencies and index providers believe external and internal uncertainties pressure Kazakhstan’s stock market. Analysts of agencies on the exchange map of the world refer to the Financial Market of Kazakhstan as the frontier, where the risks are high and poorly calculated. Based on 2022 data, Financial Market of Kazakhstan is characterized as a bit of liquid and very volatile, but still having good prerequisites for an increase in the rating (before Emerging), which may have beneficial consequences in the form of an influx of portfolio investment and entry into the global economy. The work aims to identify the main criteria and determinants for improving its position in international indices based on a comprehensive study of modern methodologies for classifying stock markets, as well as a critical analysis of the state of the domestic securities market. Set scientific questions are covered (What qualitative and quantitative criteria and factors of the stock market affect its rating according to the methodologies of international agencies? What determinants affect the increase in the rating of the domestic stock market?) by confirming the hypothesis “Identification and analysis of the main criteria and factors will positively affect the upgrade of the Kazakhstan stock market rating”. For the scientific study of theoretical and methodological practices affecting the identification of the main determinants of the FRC used interrelated, organically complementary and necessarily responsive to the tasks set empirical methods. The work has a great scientific and practical importance, which is confirmed by the adopted in September 2022 the Concept of development of the financial market of Kazakhstan until 2030.

Monetary policy and inflation targeting under global uncertainty: a SVAR approach for Tunisia

PurposeThe implementation of monetary policy by the central bank is an ongoing topic of discussion. This paper aims to explore monetary policy transmission shocks in times of uncertainty using the new World uncertainty index (WUI). The authors investigate the impact of crises, wars and pandemic shocks on selected macroeconomic variables.Design/methodology/approachThe authors use unit root tests, structural vector autoregressive model and the Granger causality test according to Toda–Yamamoto with quarterly data over 1999–2022.FindingsThe results of this study show that in the short run, there is a unidirectional relationship between the money market rate and WUI, while the relationship between the latter and the money supply (M2) is bidirectional. The short-term effect runs from WUI to inflation. In the long run, the variance decomposition shows that global uncertainty explains around 12% of inflation pressures. The uncertainty caused by special events in the world creates positive shocks on inflation in Tunisia, which decreases the ability of the central bank to control inflation.Research limitations/implicationsThe results have implications over necessary and urgent actions to be implemented for a progressive economic recovery but point to a necessary transition to an inflation-targeting regime.Originality/valueExamining monetary policy under uncertainty is a recent phenomenon. The authors purposely use a novel WUI by Ahir et al. (2022) that is unexploited in literature.

Factors Predicting Fertility Rate in Indonesia

The highly competitive environment of the nowadays modern world brought about survival challenges. Hence, individuals all over the globe are striving for a quality life with the fulfillment of their basic needs. Simultaneously, the population plays an important role in determining the distribution of resources and quality of life in a particular area. At the same time, the fertility rate is an important element of the world’s population. Hence, this study aims to analyze the effect of women's education, women's participation in the labor market, income, and mortality on the fertility rate in Indonesia. Multiple regression analysis methods with Error Correction Model (ECM) analysis technique were applied. Based on the result of the research conducted, women's education, participation in the labor market, income, and mortality rates together significantly affect fertility in Indonesia in the long term. However, the results were insignificant in the short term. Moreover, based on the long-term results of the data, it is suggested that in fertility control, these factors need to be included in developing nations.

Deciphering the response of thirteen apple cultivars for growth, fruit morphology and fruit physico-chemical attributes during different years

Apple cultivation is one of the most significant means of subsistence in the Kashmir region of the northwestern Himalayas. It is considered as the backbone of the region's economy. Apple cultivation in the region is dominated by a late maturing cultivar “Red Delicious” which usually on maturity causes glut in the market. In order to bring new cultivars in the cultivation, and to expand the maturity season, it is necessary to evaluate the new cultivars on fruit physico-chemical attributes which ultimately decide the market rates before recommending to farmers for cultivars adoption. Therefore, the current study was carried out to evaluate thirteen apple cultivars on physico-chemical attributes over two years, 2017 and 2018 under agro-climatic conditions of Kashmir region The results revealed that cultivars differed significantly in terms of physico-chemical properties. Cultivars with the highest and lowest values for initial fruit set, fruit drop, final fruit retention, and fruit firmness in 2017 did not follow the same trend in 2018. During 2017 and 2018, cultivar Mollie's Delicious possessed the highest fruit length (72.39 mm and 81.45 mm), fruit diameter (81.18 mm and 84.14 mm), and fruit weight (205.85 g and 247.16 g), whereas cultivar Baleman's Cider had the lowest values (50.76 mm and 52.83 mm, 60.10 mm and 62.08 mm, and 71.46 g and 86.94 g), respectively. The harvesting dates were quite spread out during both years of study. Cultivar Mollie's Delicious was harvested the earliest in both years, on August 5th, 2017 and August 8th, 2018. Cultivar Fuji Zehn Aztec was the last cultivar harvested in 2017 on October 2 and in 2018 on October 5. The maximum number of seeds per fruit was noticed in the cultivar Mollie's Delicious (8.34 and 8.71) during both 2017 and 2018, respectively. Cultivar Starkrimson had the fewest seeds per fruit in 2017 (7.11) and 2018 (7.42). Cultivar Baleman's Cider had the highest acidity in 2017 (0.63%) and 2018 (0.52%). In both 2017 (0.25%) and 2018 (0.23%), the Adam's Pearmain cultivar was the least acidic. Cultivar Allington Pippin (16.13 °Brix) and Red Gold (16.73 °Brix) had the highest TSS in 2017 and 2018, respectively, whereas Vance Delicious (12.30 °Brix) and Top Red (10.78 °Brix) had the lowest TSS in 2017 and 2018, respectively. The cultivars Mollie's Delicious and Red Gold had the highest total sugars (11.33 and 11.40%) in 2017 and 2018, respectively. Cultivar Baleman's Cider had the lowest total sugars (9.82%) in 2017 while Top Red (9.78%) in 2018. The cultivar Vance Delicious had the highest ratio of leaves to fruits in 2017 (55.44) and for Shalimar Apple-2 in 2018 (49.65). In 2017, cultivars Fuji Zehn Aztec (29.26) and Silver Spur (24.51), had the fewest leaves per fruit. The highest leaf chlorophyll content was recorded in cultivar Shireen (3.50 and 3.57 mg g−1 fresh weight) during the years 2017 and 2018, respectively. Cultivar Baleman's Cider had the lowest leaf chlorophyll content (2.15 mg g−1 fresh weight) during 2017, while cultivar Allington Pippin (2.09 mg g−1 fresh weight) had the lowest leaf chlorophyll content in 2018. The cultivars Fuji Zehn Aztec, with a yield efficiency of 0.78 kg/cm2 and Silver Spur with a yield efficiency of 1.14 kg/cm2 were the most yield efficient during the years 2017 and 2018, respectively. Cultivar Shalimar Apple-2 was least performing with yield efficiencies of 0.05 and 0.07 kg/cm2 during 2017 and 2018, respectively.The findings suggest that cultivar Mollie's Delicious commercially matures first and has the highest fruit length, diameter, and weight; hence, it can be a good option for cultivation so as to fetch the maximum price in the market when other cultivars are still maturing. Shalimar Apple-2 is precluded for cultivation due to least yield efficiency, whereas cultivars Fuji Zehn Aztec and Silver Spur are recommended to farmers for their higher yield efficiency.

An Analysis of House Price Prediction Using Ensemble Learning Algorithms

It is very important to understand the market drifts in the wake of booming civilization and ever-changing market requirements. The principal purpose of the study is the prediction of house prices based on current conditions. From historical data on property markets, literature attempts to draw useful insights. Business trends must be understood so that individuals may prepare their budgetary needs accordingly. A society that is ever-expanding is driven by the growing real estate industry. A lot of clients have been duped by agents setting up a fake market rate. As a result, the real estate industry has become less transparent in recent years. Due to decreased accuracy and overfitting of data, the previous model reduced efficiency, whereas the newly developed model resolves such issues and provides a rich user interface with a better model. An important part of this study is to develop an extensive model that is beneficial to both business societies and individuals. This is the main objective of this study. In order to simplify the client’s fieldwork and free up his time and money, this software is intended to assist him. Machine learning algorithms enable models to be enlightened such as root mean square error, random forest, support vector machine, k-nearest neighbors, mean squared error, extreme gradient boost, mean absolute error, R-squared score, linear regression, AdaBoost, CatBoost.

Standing lending facility in interbank market: Evidence from China.

We observe an anomaly that SLF quantity expansion is often accompanied by higher interbank market rates. With the Shibor bid panel, this paper empirically shows that SLF easing encourages bank risk-taking activity, and amplifies bank liquidity demand. The induced demand dominates the liquidity supply effect and leads to higher interbank rates. Moreover, the risk-taking behavior of state-owned banks is more sensitive to SLF than that of non-state-owned banks. These features make SLF a better expectation management tool than a price-based or quantity-based tool for interbank market liquidity management.

Re-Evaluating the Major Factors in the Low Origination Rate of the Reverse Mortgage Market

We reinvestigate the major factors in the low origination rate of home equity conversion mortgages (HECMs) in the United States from 2010 to 2017. We use panel data analysis to consider the variation in time and region and investigate the main determinants of the HECM origination rate. We examine five categories of variables: demographics, home equity, home debt level, retirement income, and taxes. We first filter out key variables and then consider the interactions among these factors. The empirical outcomes confirm the significance of including interactions and provide detailed observations to resolve several disputed issues and make policy recommendations, such as debt priority of mortgage and credit card, applying HECM as a personal or household decision, and the dominance of property tax over inheritance tax.

Linear and nonlinear asymmetric relationship in crude oil, gold, stock market and exchange rates: An evidence from the UAE

This study examines dynamic relationship among the macroeconomic variables represented by the international oil and gold prices, exchange rates and stock market index in the context of UAE's economy. The UAE is known as a major player in trading both oil and gold in the global market. Daily data for the period ranging from 19th March 2015 to 8th October 2022 is used for this study. Autoregressive distributed lag (ARDL) model is applied in both linear and non-linear specifications to explore co-movement among the variables under study. While the estimated parameters from linear ARDL model indicate the absence of any co-integration among gold, oil and stock market, the non-linear ARDL model however, does indicate and validate the presence of long-run asymmetric relation among these markets. Exchange rates play a significant role both in the short as well as in the long run. Besides, the study observes that negative shocks do have different scale of impact than the positive ones. Therefore, the present study concludes that a non-linear approach is best suited to understand the dynamics of these markets. The findings of this study have important implications for policy makers and other stakeholders as they must ensure that the direction of shocks is taken into consideration before policy prescriptions or any other investment decisions.

A National Balance Sheet Approach to the Natural Rate of Interest

We present a new estimation method for the “natural” interest rate and estimate its value for the US economy from 1961 to 2020. Presuming theoretical balance between returns on national assets and cost of national capital, we use US balance sheet information to derive a “breakeven” or implicit fundamental risk-free rate. Because, unlike r-star (r*), our rate does not presume conditions of full employment, its value should generally be lower than that of r*. We find, however, that our rate has remained above r* for much of the past 25 years, suggesting that the Federal Reserve’s accommodative policy for the past two decades has been more aggressive than previously believed. Understanding the difference between our natural rate, r*, and current market rates is critical for proper decisions in the fixed income markets.

Benchmarking Corporate Resilience and Sustainability – a framework for assessing corporate positioning in the face of uncertainty and risk

Low carbon is still a key stock market theme, but war and changing economic conditions through 2022 have placed greater emphasis on the security of supply. Yet our longstanding view still holds: the energy transition will happen, and oil and gas companies have significant value at risk. In the face of tightening carbon policies or the eventual decline in oil and gas demand, companies that fail to adapt to the emerging low-carbon world will suffer a deterioration in market rating. Plotting a strategy for the energy transition has become more complex than ever. Satisfying investors, government and public stakeholders while pursuing secure, affordable and sustainable sources of energy requires a delicate balance. Unanticipated shocks like the global pandemic or Russia’s invasion of Ukraine make strategic planning a veritable high-wire act. The complexity in mapping out an approach to the energy transition makes it even harder to benchmark the different strategies companies may employ. How are companies positioned to navigate the energy transition over the coming decades? Which companies are best situated to handle shocks to the market in the next few years? We believe these questions of near-term resilience and long-term sustainability can be answered by examining (a) a company’s financial position and scale, (b) its portfolio outlook and (c) its carbon exposure and transition strategy. Building on these concepts of Corporate Resilience and Sustainability, we can compare the strategies of Australia’s largest energy players against their international peers. We can highlight their strengths, weaknesses and areas for focus. We can show you what ‘best-in-class’ looks like.

The Relationship between the Gold Price, Crude Oil Price, Exchange Rate and Chinese Stock Market Indexes

One of the trickiest problems for investors is how the financial and commodity markets interact with each other. The volatility in one market might affect the price of the other market. This essay aims to clarify the relationship between gold, crude oil, exchange rates, and Chinese stock market indices. In order to do this, the Shanghai Stock Exchange Index and the China Industrial Index, two indices that reflect the Chinese financial market, were subjected to the DCC-GARCH model (Generalized Autoregressive Conditional Heteroskedasticity Model). By capturing the dynamic correlations of the time series' variance, covariance, and correlation coefficient, this model aids in illuminating the long-run dynamic correlation between returns. The findings show that gold and crude oil are positively correlated with both the Shanghai Stock Exchange Index and the China Industrial Index, while the correlations between the USD CNY exchange rate and the two Chinese stock indices are negatively correlated, using monthly data from 2000-01-03 to 2022-08-30. This paper shows that stock prices in China are weakly linked to international commodity markets and exchange rate with the US. Additionally, throughout the observation period, financial crisis (2008) and the COVID-19 pandemic breakout (2020) enhanced comovement between the Chinese stock market, commodities, and exchange rate in general.

Integrated multi-trophic aquaculture with sugar kelp and oysters in a shallow coastal salt pond and open estuary site.

Sustainable aquaculture includes the aquaculture of non-fed crops that provide ecosystem services including nutrient extraction and water quality improvement. While shellfish are the most farmed sustainable aquaculture crops in the USA, shellfish farmers in the northeastern US have an interest in diversifying their crops and incorporating seaweeds into their farms. In this study, we worked with oyster farmers to investigate the potential for farming sugar kelp, Saccharina latissima, across different environmental regimes in coastal Rhode Island USA. Kelp seed spools were outplanted at two time points in the fall/winter of 2017 and 2018 at four sites and cultivated until harvest the following spring. Kelp performance (length, width, yield), tissue content, and nutrient extraction were determined for each line in each year; oyster growth was also measured monthly for one year at each site. We found that kelp could successfully grow in both shallow coastal lagoons and estuarine sites, although the timing of planting and placement of sites was important. Lines that were planted earlier (as soon as water temperatures<15°C) grew longer and yielded more biomass at harvest; overall, kelp blade yield ranged from 0.36 ± 0.01 to 11.26 ± 2.18 kg/m long line. We report little variation in the tissue quality (C:N) of kelp among sites, but differences in biomass production led to differences in nutrient extraction, which ranged from 0.28 ± 0.04 to 16.35 ± 4.26 g nitrogen/m long line and 8.93 ± 0.35 to 286.30 ± 74.66 g carbon/m long line. We found extensive variability in kelp growth within and between lines and between years, suggesting that crop consistency is a challenge for kelp farmers in the region. Our results suggest that, as there is a lower barrier in terms of permitting (versus starting a new aquaculture farm), it may be a worthwhile investment to add sugar kelp to existing oyster farms, provided they have suitable conditions. At current market rates of US$0.88-$3.30 per kg, farmers in southern New England have the potential to earn US$2,229 per 60 m longline. While seaweed aquaculture is growing, considerable barriers still exist that prevent wide-scale kelp aquaculture adoption by existing aquafarmers.

Financial development, interest rate pass-through and interest rate channel of monetary policy

The paper examined the interest rate operations and processes in Nigeria and examined the role of financial development in incentivizing central bank monetary policies from the monetary policy rate to the money market rates, lending rates, and deposit rates. The analysis covered the period from 1981 to 2021 with sub-samples for 1981 to 2011 and 1991 to 2021 to test the consistency of the findings. The findings confirmed that interest rate pass-through is incomplete for Nigeria, albeit to a lower degree in the short run compared to the long run. The reasons for this may be due to interest rate stickiness, problems of asymmetric information, and bank switching costs. Also, the findings confirmed that financial development weakens the impact of monetary policy on the interest rate pass-through process, while the analysis of the asymmetric mean adjustment lags confirmed that changes in the policy rate are transmitted to the deposit and lending rates within the year it was announced. The analysis confirmed that the results across each sub-sample and the robustness tests are consistent with the main analysis. Therefore, it is imperative that policymakers should account for financial development when designing monetary policy effectiveness since it can hinder or strengthen the interest rate monetary policy channel.

How Do Mortgage Rate Resets Affect Consumer Spending and Debt Repayment? Evidence from Canadian Consumers

AbstractOne of the most important channels through which monetary policy affects the real economy is changes in mortgage rates. This paper studies the effects of mortgage rate changes resulting from monetary policy shifts on homeowners' spending, debt repayment, and defaults. The Canadian institutional setting facilitates the design of identification strategies for causal inference, since the vast majority of mortgages in the country experience predetermined, periodic, and automatic contract renewals with the mortgage rate reset based on the prevailing market rate. This allows us to exploit quasi‐random variation in the timing of the rate reset and to present causal evidence for both rate declines and increases using detailed, representative consumer credit panel data. We find asymmetric effects of rate changes on spending, debt repayment, and defaults. Our results can be rationalized by the conventional cash‐flow effect in conjunction with changes in consumer expectations about future interest rates upon the reset. Given the pervasiveness of Canadian‐type mortgages in many other OECD countries, our findings have broader implications for the transmission of monetary policy to the household sector.

РИНОК ЖИТЛОВОГО БУДІВНИЦТВА РЕГІОНІВ УКРАЇНИ: ПРОБЛЕМИ ТА ПЕРСПЕКТИВИ ВІДНОВЛЕННЯ У ПОВОЄННИЙ ПЕРІОД

The article analyzes the housing construction market and identifies the main factors restraining its growth. First, the author confirms that the housing construction market suffered a significant blow during the spread of COVID-19, as the decrease in construction volumes amounted to 12.4% compared to the previous year, and the second, more massive pressure was felt by the market after the start of armed warfare in Ukraine (a drop of almost 50%). It was determined that despite rather attractive mortgage lending conditions, the housing market is not experiencing a significant recovery. Secondly, in the regional context, such changes were uneven, for example, during the "covid" period, some regions managed to maintain positive dynamics, such as Poltava and Vinnytsia regions, where the growth was more than 25%, while some regions, on the contrary, "fell rapidly", losing up to 30% of housing construction volumes compared to the previous year (for example, Luhansk region - the fall was more than 60%). At the same time, the correlation between the volume of housing construction and the gross regional product per capita, which were adjusted for the price index, was confirmed, but there is a basic level of income that should ensure "objective quality" of living for households so that they can invest in housing construction. The study shows that, in addition to household incomes, there are other important factors that can become demotivators for the state and dynamics of the housing market. These include the ability of the state and the banking and financial sector to freely dispose of significant amounts of free funds that can be used for construction. At the same time, the risks of economic instability limit the investment potential of the financial institution (as evidenced by the low activity of citizens in participating in the eHouse program). In addition, economic instability has a significant impact on the development ofconstruction. Thus, it was noted that the greater the fluctuations, the worse the results of the industry. Therefore, the key factors restraining the positive dynamics of this market are the following:low investment capacity of the population, economic instability, external factors (the war factor) and expectations of market participants. Demonstrating the differentiation of indicators of development of the housing construction market by region, it is stated that there has been a change in the "landscape" of growth centers - the western regions of Ukraine have been included in them, which is associated with migration processes (relocation of internally displaced persons), and thus contributes to the restoration of the growth rate of the housing construction market in these regions. Therefore, the further development of the housing market will be associated with the search for and attraction of new investors, for example, European governments, implementation of joint projects and grants to restore energy-saving territorial development (including through the construction of social housing), etc.

BALANCING MONETARY POLICY IN DEFENCE ECONOMICS IN UKRAINE

The russian federation's launch of a full-scale war against independent Ukraine on February 24, 2022, has presented unprecedented challenges to the country. In addition to resistance on the battlefield, Ukraine must implement adaptive macroeconomic policies to address the situation. This combination of military and economic efforts not only prevents economic collapse but also maintains fragile macroeconomic stability during wartime. Monetary stability becomes especially important, highlighting the absolute necessity for effective implementation of monetary policy.This article aims to identify the key characteristics of Ukraine's defence economy and forecast key policy rates and exchange rates during the war.The prerequisite for forecasting was the analysis of endogenous and exogenous factors determining the current state of the Ukrainian economy: index of business expectations in Ukraine and partner countries, state of international trade and balance of payments, disparities in the labour market, reorientation of the state budget to military needs, devaluation of the national currency, high inflation, increase of financial capital price.Modelling is based on consumer price index (CPI), household inflation expectations, key policy rate of the National Bank of Ukraine, real and nominal effective exchange rates hryvnia to USA dollar, gross and net international reserves, gross and net foreign exchange market interventions, the UK CPI, the USA CPI, EU CPI, and the weighted average yield of domestic government bonds. The methodology involved the use of the VECM model (Vector Error Correlation Model) and the Bagging machine learning method, adapted to time series. Using this methodology enabled an accurate forecast of the key policy rate. In determining the optimal exchange rate, a modified formula was used that takes into account the monetary base, total bank deposits, foreign currency deposits in banks, exchange rate in the black market, and international reserves. This modification enabled the prediction of an exchange rate that closely approximates the official exchange rate.

오피스 시장에서 비체계적 위험과 투자수익률간의 관계

In this paper, the excess ROI(Return on Investment) and SCL(Security Characteristic Line) ofthe Seoul office market by region are driven based on the ROI of the Seoul office market and CD(91days) rate of return(quarterly), then with this, idiosyncratic risk is extracted, and the idiosyncraticrisk-excess rate of return on investment relationship in the office market by district is analyzed. Finally,the results driven from this study is as follows; 1) Regarding the idiosyncratic risk-excess ROIrelationship by district in Seoul, the CBD shows a low risk-low return tendency, and the YBD showsa high risk-high return. Moreover, in the case of total risk-return, the risk of the ETC is higher thanthat of the GBD, but the idiosyncratic risk is lower than that of the GBD, showing different risk-returncharacteristics depending on the type of risk. 2) As to the idiosyncratic risk-excess investment returnrelationship by district in Seoul, although all districts are markets affected by idiosyncratic risk, thegrowth rate in excess return compared to idiosyncratic risk are different. 3) The excess return oninvestment/idiosyncratic risk by district differs according to the growth rate in office buildings’ salesprice, and no change in the excess return on investment per idiosyncratic risk due to the increase inNOI could be confirmed in all district but YBD. Finally, this paper is meaningful in that it verifies theexistence of idiosyncratic risk in the Seoul office market and the statistical significance betweenidiosyncratic risk-return on investment, and derives related implications through a comprehensiveanalysis relevant to the market situation.