Research On The Housing Prices Of China Based On The Common Correlated Effects Estimator

In this paper,we introduce the different types of panel data and recently developed econometric techniques,the common correlated effects(CCE)estimator,which is suitable for the analysis of panel data subject to heterogeneity and sectional dependence.Then,we introduce the panel unit root test and panel cointegration test based on the common correlated effects estimator.This paper provides an empirical analysis of changes in housing prices of China,using panel data of 35 large and important cities in China from2002 to 2015.We examine the extent to which housing prices are driven by fundamentals such as per capita disposable income,growth rate of the census register population,consumer price index,as well as by common shocks.We determine the speed of adjustment of housing prices to macroeconomic and local disturbances.The empirical analysis finds a cointegration relationship between housing prices and per capital incomes in first-tier and new first-tier cities,but not in all 35 cities.