Impact of Metro Opening on Housing Price: Empirical Analysis--Rethink the present “Metro-Hot”
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| Title | Impact of Metro Opening on Housing Price: Empirical Analysis--Rethink the present “Metro-Hot”
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| Author | Wang Yuelong |
| Organization | Jiangxi University of finance and economics; China Academy of Society Science |
| Email | wangyuelong@jxufe.edu.cn |
| Key Words | Metro-Hot; Hosing Price; Policy Evaluation; Treatment Effect; Counterfactual Analysis |
| Abstract | This study estimates the impact of metro opening on housing price using housing price data of 35 large and medium-sized cities from 2004-2011 and employing treatment effect model proposed by Maddala. As well, this study rethinks the “Metro-Hot” phenomenon started in 2000 from the perspective of macroeconomic regulation and control to housing price. Empirical results show: 1) The metro opening contribution to commercial housing rising is about 12.63%. The counterfactual results show that the rising levels of housing prices will be over those cities where already opened metros, which is caused by “Metro-Hot” to a great extent. 2) Opening metro or not in a city has no necessary correlation with local economic development level, which is also not the fundamental starting point for solving traffic congestion. 3) According to the Plan of Rail Transit System 6000 km in 2020, the housing price will rise 26% only because of metro opening. Scenario simulation results show that rising housing price will make residents in 33 metro cities to work extra 3.45 years to afford for housing in 2020. From the perspective of stabilizing housing price, this study advocates to strictly control the opening of metro around and develop it gradually. |
| Serial Number | WP653 |
| Time | 2014-08-12 |
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