Interlinkage Between Property Price and Credit: Empirical Evidence from India
Authors
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Assistant Professor, Department of Economics, Maitreyi College, University of Delhi, Chanakya Puri, New Delhi ,IN
Priti Mendiratta
Keywords:
House Price, Credit, Granger Causality, CointegrationAbstract
The paper investigates the two-way character of the link between asset prices (especially housing prices) and credit in India by examining quarterly data for fifteen Indian cities for a period of six years from 2007Q4 to 2013Q4. There may be many channels through which real estate and credit markets interact and causality may go in both directions, asset prices influencing credit through expectations formation and, credit in turn, impacting asset prices. Time series econometric tools of unit root, cointegration and causality tests are used to test for existence of long run relation and direction of causality for each city. The contribution of this paper is to provide evidence on causality between credit and housing price with respect to India and discuss the policy implications.Downloads
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All the articles published in JBT are distributed under a creative commons license. The journal allows the author(s) to hold the copyright of their work (all usages allowed except for commercial purpose).Accepted 2018-05-17
Published 2018-05-17
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