The Price Decision Of Commodity Housing In China Based On Search Theory And Bargaining Theory

In 1970 American economists DeGroot and McCall introduced the search theory of labor market into consumer theory, they analyzed and believed that sellers will firstly determine a reservation price to the potential consumers, then accept the purchase requirement of a consumer who first offers a price which is higher or equal to the reserve price. After searching out this consumer, it indicate that the seller finish a searching. While the ascertainment of reserve price is relying on the features of the product for sale and the distribution of potential consumers. In 1988, Haurin applied this theory to real estate market, especially to commodity housing market. In the following decade the economists in China and foreign countries apply this theory to analyze the sales and the ascertainment of transaction price in housing market on the basis of predecessors.In 1998 our country conducted the reform of housing system, abolishing the welfare-oriented public housing distribution system, residential buildings were put into market as commodity. In the following decade, the real estate market developed extremely fast, and the state macro-control is constantly escalating. Due to the contradiction between human and land, and imbalance regional economy development, our real estate market has a distinct Chinese Characteristics, but to stabilize the price of commercial residential buildings and to realize the target of Home Ownership Scheme still face lots of difficulties:such as the high relevance between housing market and macro- economy development, the rapid growth and much too large cardinal number of housing prices, benefit entanglements between property developers and local government, rent-seeking activities of developers, the Saving and Loan Crisis and interest rates regulation and control faced by commercial banks, the imbalance regional development with housing market, regional and oligarchical monopoly etc.. Effectively regulate and control the real estate market especially the housing market concerned with national economy and the people's livelihood, which is the first priority stressed by premier Wen Jiabao in his government work report of this year, and which is the embody of thoroughly applying the Scientific Outlook on Development.This paper attempts to start from the perspective of search theory and theory of bargaining, under the condition of "asymmetric information" to discuss the major behavioral agent-the behavior pattern of developers and consumers on our commodity housing market, further more to analyze the influencing factor and decisive matter on transaction price of housing market. This research method assist us to better understand the situation of seller and buyer be, the information they have, the cost they paid for searching the information, and the way of ascertaining the transaction price during house purchasing. In this way, the direction for making policies has been provided:in which way shall we make policies to adequately use of resources, to guarantee the stable and reasonable operation of housing price and quantities, and to realize Home Ownership Scheme.The conclusion of this paper:the government policy should well balance the development of economy and people housing; clear land supply and prevent monopoly from the first level market as well; make different regulatory policies in different region and enhance the competition of the central region; stabilize the suburban housing prices to ensure the consumer confidence of the resident; increase the supply of medium house area to meets the needs of ordinary consumers; government regulation of the housing markets'revenue policy is ineffective and the market policy to inhibit the price is valid for short-term and invalid for long-term.The innovation of this paper lie in the perspective of search theory and bargaining theory, apply economic model to make regression analysis with the sample of Beijing common housing market, researched the searching conduct of the seller and buyer and price ascertainment in commodity housing market, stressed that among the decisive factors of transaction price, the market developing status, market attribute, feature of house itself, value of the land etc. have significant distinction. In the national macro-control, found that the income policy and supply and demand policy of government has no effect, the former will not influence the house price, while the latter has effect with market control in short term but not long term.This paper includes five parts:Partâ… , introduction, which introduces the significance of theory and practicability of subject selection, summarizes the research achievements about commodity housing market got by Chinese and overseas scholars in related areas since 1980s, and makes roughly comparison and analysis.Partâ…¡, The economics explanation of the main body behavior in commodity housing market:based on the economical model determined by search theory, bargaining theory and transaction price.Partâ…¢, enduing the experience to explains into economic variables from the constructed model, use actual data to analysis the level, which is value of the land, the market developing status is boom or a recession, market attribute is efficient or inefficient etc. impact on housing price.Partâ…£, taking the common housing market of Beijing 8 districts from Feb,2009 to Aug,2010 as a sample, apply measuring software to make analysis, use live data to compare and analyze the impact to house price by all influenced factors, and to analyze the effect on housing market by government control policy, further more to get a conclusion of ineffective income policy and the market policy to inhibit the price.Partâ…¤, policy suggestion and conclusion.