Impact of Housing Price on Consumption in Urban China

摘要

This research examines the impact of housing price on consumption in Urban China. Using cross-sectional time series data of 9 cities from 1998 to 2005, we estimate regressions relating consumption to income and housing price. The results show no evidence that the house price increases have produced wealth effect on consumption. The conclusion in this paper shows that the findings of housing wealth effect from other counties can not be generalized. The period of house market development and the institutional framework reduce the housing wealth effect on consumption in urban China.