| China's real estate market is booming since the housing market reforms of 1998.The number of employees from the real estate industry rose from 825.9 thansand in 1998 to 2.76 million at the end of 2014.The completed amount of Real estate development and investment in 2014 is 27 times the size of that in 1998.At the meantime, The real estate industry promotes the rapid development of not only upstream industries like iron and steel, machinery, cement and the rest but also downstream industries such as home improvement, building materials and so on. The real estate industry which has affected every aspect of people's life becomes a pillar industry of the national economy. So the authority must take into account the role of the real estate market when using a variety of policy tools for macroeconomic regulation and control. In recent years, the governments often conduct monetary policy such as controlling credit scale to respond to big macroeconomic fluctuations. It is that the transmission mechanism and the effect of monetary policy has become a hot issue recently. As one aspect of asset price, real estate price will affect the transmission of bank credit. Our country has a vast territory with different development stages in different regions. Therefore, it is essential to explore the effectiveness of the bank credit transmission mechanism and regional differences.This paper constructs a dynamic panel model to explore the effectiveness of the housing prices transmission mechanism of bank credit in China by using the annual panel data of 31 provinces and autonomous regions from the year of 2000 to 2014. First of all, elaborate the role of the process of bank credit transmission mechanism in the real estate market from the perspective of economic theory, followed by conducting research of the effectiveness of the mechanism according to China's current actual situation. The process mainly consists of two stages.First of all, study how bank credit affects the real estate prices, and then the house prices transfer to the real economy level. The two phases which constitute a complete response process are both independent of and linked to each other.On indicators selected aspects, the balance of financial institution is selected as a measure of bank credit, and the average price of commercial housing sales are selected as a measure index of current house prices in various provinces and cities at in China. In addition, retail sales of social consumer goods and social investment in fixed assets are selected as measures of consumption and the investment situation respectly, so as to construct a dynamic panel model to explore the different stages of conduction of the relevant variables interaction, and to analyze the strength of relative effect by estimating model coefficients at all levels through GMM method.The results show that:(1)The scale of China's bank credit can regulate the price of house price;(2)The second phase of the bank credit transmission mechanism is in the presence of obstacles. The overall effect of house prices on consumption and investment are positive, while the consumption effect of housing prices in the East is negative.(3)At present, there are significant regional differences in bank credit transmission effect of the real estate prices. Specifically speaking, in the first conducting phase, housing prices of the central and western regions are more sensitive to credit scale. Meanwhile, in the second stage of the transmission, the elasticity coefficient of house prices on consumption in conduction process in the East region is significantly negative. Besides, the increasing of real estate prices will inhibit the rise of consumption, and the role of the housing prices on the consumption in Mid-western regions mainly manifest in the wealth effect. On the other hand, from the point of view of the investment effect, the intensity effect of investment in the eastern region is higher than that in the central and western regions. |
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