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Housing wealth appreciation and heterogeneous household consumption: Evidence from China

In this paper, we develop a DSGE model including heterogeneous households, introduce the financial friction of credit constraint mechanism, and study the impact of house price shocks on the consumption of heterogeneous household. Based on this, the CHFS data in 2011, 2013, 2015, 2017, and 2019 were...

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Autores principales: Qi, Yingying, Yu, Guohua, Liu, Xiang, Ren, Yuanming
Formato: Online Artículo Texto
Lenguaje:English
Publicado: Public Library of Science 2023
Materias:
Acceso en línea:https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10553299/
https://www.ncbi.nlm.nih.gov/pubmed/37796903
http://dx.doi.org/10.1371/journal.pone.0289712
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author Qi, Yingying
Yu, Guohua
Liu, Xiang
Ren, Yuanming
author_facet Qi, Yingying
Yu, Guohua
Liu, Xiang
Ren, Yuanming
author_sort Qi, Yingying
collection PubMed
description In this paper, we develop a DSGE model including heterogeneous households, introduce the financial friction of credit constraint mechanism, and study the impact of house price shocks on the consumption of heterogeneous household. Based on this, the CHFS data in 2011, 2013, 2015, 2017, and 2019 were used to test the marginal propensity to consume for housing wealth appreciation under different credit constraints. Results show that: Firstly, the financial accelerator mechanism plays an important role in the transmission of housing price shocks to household consumption. The looser the degree of credit constraints, the more obvious the rise in housing prices will be to the consumption expenditure of borrowing household. Secondly, the impact of housing wealth appreciation on household consumption under different credit constraints is heterogeneous. Among them, housing wealth appreciation has a significant positive impact on household consumption expenditure with multiple houses, credit cards, non-loan restrictions, while the marginal effect on the consumption expenditure of households with only one house, loan limited, and no credit cards decreases. Thirdly, for every 1% increase in the housing wealth appreciation, household consumption will increase significantly by 0.10–0.14%.
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spelling pubmed-105532992023-10-06 Housing wealth appreciation and heterogeneous household consumption: Evidence from China Qi, Yingying Yu, Guohua Liu, Xiang Ren, Yuanming PLoS One Research Article In this paper, we develop a DSGE model including heterogeneous households, introduce the financial friction of credit constraint mechanism, and study the impact of house price shocks on the consumption of heterogeneous household. Based on this, the CHFS data in 2011, 2013, 2015, 2017, and 2019 were used to test the marginal propensity to consume for housing wealth appreciation under different credit constraints. Results show that: Firstly, the financial accelerator mechanism plays an important role in the transmission of housing price shocks to household consumption. The looser the degree of credit constraints, the more obvious the rise in housing prices will be to the consumption expenditure of borrowing household. Secondly, the impact of housing wealth appreciation on household consumption under different credit constraints is heterogeneous. Among them, housing wealth appreciation has a significant positive impact on household consumption expenditure with multiple houses, credit cards, non-loan restrictions, while the marginal effect on the consumption expenditure of households with only one house, loan limited, and no credit cards decreases. Thirdly, for every 1% increase in the housing wealth appreciation, household consumption will increase significantly by 0.10–0.14%. Public Library of Science 2023-10-05 /pmc/articles/PMC10553299/ /pubmed/37796903 http://dx.doi.org/10.1371/journal.pone.0289712 Text en © 2023 Qi et al https://creativecommons.org/licenses/by/4.0/This is an open access article distributed under the terms of the Creative Commons Attribution License (https://creativecommons.org/licenses/by/4.0/) , which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.
spellingShingle Research Article
Qi, Yingying
Yu, Guohua
Liu, Xiang
Ren, Yuanming
Housing wealth appreciation and heterogeneous household consumption: Evidence from China
title Housing wealth appreciation and heterogeneous household consumption: Evidence from China
title_full Housing wealth appreciation and heterogeneous household consumption: Evidence from China
title_fullStr Housing wealth appreciation and heterogeneous household consumption: Evidence from China
title_full_unstemmed Housing wealth appreciation and heterogeneous household consumption: Evidence from China
title_short Housing wealth appreciation and heterogeneous household consumption: Evidence from China
title_sort housing wealth appreciation and heterogeneous household consumption: evidence from china
topic Research Article
url https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10553299/
https://www.ncbi.nlm.nih.gov/pubmed/37796903
http://dx.doi.org/10.1371/journal.pone.0289712
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