The Effects of Reference Pricing on Housing Market: Evidence from Shenzhen China

Authors

  • Philip Arestis University of Cambridge, UK
  • Mianshan Lai Shenzhen University, China
  • Jia Hou Shenzhen University, China

DOI:

https://doi.org/10.2298/PAN220629015A

Keywords:

Reference pricing, Housing price, Housing market

Abstract

This paper investigates an unprecedented regulation measure in the housing market, reference pricing, with evidence from Shenzhen China. We use a unique panel dataset, obtained through questionnaires to real estate agents, to document the effects of the policy on the housing market. The hypotheses that trading volume and house price decrease are validated by the data, while the one that turnover time increases is not supported. We discuss potential mechanisms that may explain these effects. Meanwhile, we infer estate-level discount factors that are not public information. Based on these factors, we forecast reference prices for the subsequent year. Overall, this paper fills the gap in the field of reference pricing effects on the housing market. 

Keywords: Reference pricing, Housing price, Housing market. 

JEL: R31, O18, E64

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Published

2022-07-01

How to Cite

Arestis, P., Lai, M., & Hou, J. (2022). The Effects of Reference Pricing on Housing Market: Evidence from Shenzhen China. Panoeconomicus, 1–25. https://doi.org/10.2298/PAN220629015A

Issue

Section

Original scientific paper

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