TITLE:
Study on the Impact of Local Public Expenditure on Housing Price—An Empirical Analysis Based on Provincial Panel Data
AUTHORS:
Shihao Li
KEYWORDS:
Capitalization of Public Expenditure, Housing Price, Consumer Expectation
JOURNAL NAME:
Modern Economy,
Vol.9 No.2,
February
11,
2018
ABSTRACT: Based on the discussion about transmission mechanism
of local public expenditure on housing price under different housing market
types, the paper performs an empirical study on the influence of various public
expenditures on housing price by using Chinese panel data of provinces from
2007 to 2015. According to the result, public education expenditure and public
transportation expenditure have prominent capitalization effect on housing
price. Among the expansions of various local public expenditures, public
education expenditure is the most effective type to promote the capitalization
of commercial housing. In dynamic panel test, the capitalization effect of
public expenditure maintains significant after the introduction of consumer
expectation, which is consistent with the regression result of static panel. At
last, the paper puts forward some relevant policy suggestions for the
government to optimize the structure of public expenditure, guide consumer
expectations reasonably and promote the sound development of real estate
market.