What can an open-economy DSGE model tell us about Hong Kong’s housing market?
Michael Funke and
Michael Paetz
Quantitative Macroeconomics Working Papers from Hamburg University, Department of Economics
Abstract:
This paper develops an open-economy DSGE model with a housing-market sector and a borrowing constraint. Contrary to standard conventions, domestic households are allowed to invest in foreign housing and vice versa. Using Bayesian methods, the model is applied to data for Hong Kong. The results show that Hong Kong’s housing market is quite open to foreign investment, and perhaps more significantly, that variations in the loan-to-value ratio and housing preference shocks largely explain business cycle volatility.
Keywords: DSGE models; housing; open economy; Hong Kong (search for similar items in EconPapers)
JEL-codes: D91 E21 E44 F41 (search for similar items in EconPapers)
Date: 2010-11
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Citations: View citations in EconPapers (1)
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Working Paper: What can an open-economy DSGE model tell us about Hong Kong's housing market? (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ham:qmwops:21011
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