ECONOMICS TRANSITION AND COMMERCIAL PROPERTY MARKETS
||Wu, Hao; Richard Reed
||ECONOMICS TRANSITION AND COMMERCIAL PROPERTY MARKETS
||Book of Abstracts: 15th Annual European Real Estate Society Conference in Kraków, Poland
||This paper focuses on the theory of economic transformation, applied to property market emergence and comparing different transitional economies. Past experience of the Chinese and East European markets has major differences. This paper reviews the Chinese economic transition with emphasis putting on property markets especially their formation and behaviour. Property markets’ structural characteristics are examined and compared. Basic supply and demand for commercial space are also compared and evaluated. Horizontally, comparing and extending the study of Chinese cities’ property markets will enhance the knowledge about emerging property markets. Vertically, comparing emerging markets, although rarely observed, can be a very useful way to extend our understanding of market behaviour and maturity. The emergence of commercial property markets depends on the formation process of market structure, as well as the business cycle in each country. The Chinese and the Polish markets differ in these regards. Yet the transition has provided some common ground which has resulted in similarity between the two. State intervention in market formation and emergence is necessary and essential which should not be mixed up with the much criticised “agency problem”. This is essentially the problem of human individuality existing in every economic system. Transitional economies do share some common features in their property markets.
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