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https://dipositint.ub.edu/dspace/handle/2445/209243
Title: | Rational housing demand bubble |
Author: | Clain-Chamosset-Yvrard, Lise Raurich, Xavier Seegmuller, Thomas |
Keywords: | Bombolla immobiliària Especulació Control de preus Real estate bubble Speculation Price control |
Issue Date: | 6-Jun-2023 |
Publisher: | Springer Verlag |
Abstract: | We provide a unified framework with demand for housing over the life cycle and financial frictions to analyze the existence and macroeconomic effects of rational housing bubbles. We distinguish a housing price bubble, defined as the difference between the housing market price and its fundamental value, from a housing demand bubble, which corresponds to a situation where a pure speculative housing demand exists. In an overlapping generation exchange economy, we show that no housing price bubble occurs. However, a housing demand bubble may occur, generating a boom in housing prices and a drop in the interest rate, when households face a binding borrowing constraint. The multiplicity of steady states and endogenous fluctuations can occur when credit market imperfections are moderate. These fluctuations involve transitions between equilibria with and without a housing demand bubble that generate large fluctuations in housing prices consistent with observed patterns. We finally extend the basic framework to a production economy and we show that a housing demand bubble increases housing prices, which can still be characterized by large fluctuations. |
Note: | Versió postprint del document publicat a: https://doi.org/https://doi.org/10.1007/s00199-023-01501-4 |
It is part of: | Economic Theory, 2023 |
URI: | http://hdl.handle.net/2445/209243 |
Related resource: | https://doi.org/https://doi.org/10.1007/s00199-023-01501-4 |
ISSN: | 0938-2259 |
Appears in Collections: | Articles publicats en revistes (Economia) |
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