Studies On The Effect Of Bank's Credit Behavior On Real Estate Bubble

Bank credit is always the main source of real estate investment funds. In recent years, real estate market price continues to climb accompanying the sharp increase in the bank credit. In some existing studies, bank credit is sometimes considered as the major factor driving real estate price to rise. Does the above-mentioned point of view accord with the current reality in China? Whether the increase in bank credit drives the real estate price to rise, the rising of the real estate price urges the bank credit to increase sharply, or the two interact as both cause and effect?The thesis empirically analyzes the relationship between bank credit and real estate price and demonstrates the co-integration relationship between the two, that is, the real estate price is the Granger cause of the bank credit while the bank credit is not the Granger cause of the real estate price. Although the result of empirical analysis demonstrates that bank credit is not the Granger cause of the rise in real estate price, it does not mean that bank credit behavior can not affect real estate price. The thesis builds a model of bank manager behavior, real estate price and real estate credit market to analyze the impact of bank manager behavior on real estate price. The result of this thesis's research is: when bank issues a loan, a put option is issued similarly by the bank at the amount of loan unpaid simultaneously. But bank managers always attempt to under-assess this put option, which easily causes the bubble of real estate price. Especially bank managers with shorter term of office are more easily encouraged to under-assess the option than those with longer term. Furthermore, the struggle between these two sorts of bank managers may easily result in the rise of market deposit interest rate and the decline of basic value of real estate. All these increase the gap between the market price and basic value of the real estate. At the last part of the thesis, corresponding policy suggestions are finally provided on the basis of empirical research and model analysis.The thesis mainly contributes to relatively complete and detailed analysis of relationship between bank credit and real estate bubble, and by empirical analysis, demonstrates co-integration relationship between bank credit and real estate price and that real estate price is the Granger cause of bank credit. Some existing studies on bank credit behavior and real estate bubble base on the analysis from macroscopic view. The thesis discusses from microscopic view the impact of bank manager's credit behavior on asset bubble, and builds a simple model to discuss the impact of bank manager's moral risk behavior on real estate bubble. At present, the study from this angle is fairly less in China...