Regresar

House prices, cbkp_redit and willingness to lend

Abstract:

This article establishes a Tobin's q model in which house prices fluctuate around their long-run equilibrium due to fluctuations in cbkp_redit availability and income. It is shown that house prices are positively related to cbkp_redit in the short run, but negatively related to the availability of cbkp_redit in the long run. Using survey data on banks' willingness to lend and data on disintermediation for the USA over a long period, and for eight OECD countries over a short period, it is shown that the availability of cbkp_redit is the principal variable driving house prices around their long-run equilibrium. © 2011 The Economic Society of Australia.