Eres : Digital Library : Works

Paper eres2011_204:
The Impact of Real Estate Prices:Noise Traders’ Self-Fulfilling Expectations and Market Stress

id eres2011_204
authors Hung, KuoChe; Chen, MingChi; Huang, LingYu
year 2011
title The Impact of Real Estate Prices:Noise Traders’ Self-Fulfilling Expectations and Market Stress
source 18th Annual European Real Estate Society Conference in Eindhoven, the Netherlands
summary This paper examines whether noise traders generated by self-fulfilling mechanisms cause irrational price volatility. Because their self-fulfilling expectations are based on market sentiment, the regulators need to stabilize the prices through policy announcements or policy tools. This study analyzes noise traders’ self-fulfilling expectation in the China’s market where government strongly interfere. We find that asymmetric information may initiate noise traders into self-fulfilling expectation, and government is unsuccessful to control the house price shooting. We further consider the influence of market state switching. It finds that market presents evidence of self-fulfilling expectation, and also increased price volatility counteracts government intervention. Finally, other financial markets except stock are still ineffectiveness by controlling contagion effect.
keywords real estate price, information asymmetry, selffulfilling expectations
series ERES:conference
email m.t.player@gmail.com
discussion No discussions. Post discussion ...
ratings
session H1: Shopping Centres
last changed 2011/06/23 16:27
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