DOI: 10.5176/2251-1997_AF18.38
Authors: Guo Na, Fan Shu-ting,Zhu Yi-hao
Abstract:
This paper constructs the endogenous DSGE model which includes the real estate department, in addition, this paper examines the dynamic response of economic and financial variables in the face of different exogenous impact under different real estate price stickiness. The results show that technological advances can push up house prices in a way that increase the return on investment and reduce systemic financial risks; the impact of falling housing prices and the financial sector can increase risk premiums and financial risks; tight monetary policy shocks can significantly reduce housing prices and ease macroeconomic conditions fluctuation. Moreover, there are differences in the degree of response between financial variables and macroeconomic variables to exogenous-shocks at different real estate price stickiness, variables often deviate smaller from the steady state under high price stickiness. The paper reaches policy which has a significant policy revelation on effective measure of monetary policy and a new round of real estate market’s regulations.
Keywords: House Prices’ “stickiness”; Systemic Financial Risks; Monetary Policy Regulation; DSGE Model.
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