The Influence Of Real Estate Development To The Economic Growth: An Empirical Analysis

The development of Real Estate has attracted more and more attention in the society. During about 10 years, Per Capita Floor Space of Residential Building in Urban Areas soared from 18.7 square meters in 1998 to 28.0 square meters in 2006. The rate of Real Estate Investment to GDP went from 4.61% to 9.19%. Scholars have done researches on the influence using just one index. This article will discuss the influence of Real Estate development to the economics growth in a wilder way.After describing the situation and policies of Real Estate in China, the article starts at the Real Estate's attribution to the GDP. The result is that the contribution rate fluctuated in 1998-2006. The rate peaked at 4.76% in 2001 and collapsed at an all-time low of 2.17% in 2004. Rejecting the price factor, the Real Estate developed together with the economic growth.The article discusses the forward and backward quantity correlation between Real Estate and other industries in China, by adopting Input-Output Model of 42 industries in 2002. The result is that the correlation in 2002 is 1.2393. Six industries have the most intimate relationship with it. They are Banking and Insurance,Public Management and Social organization,Wholesale and Retail Trades,Construction,Chemical Industry and Leasing,Business Services, totally accounting for 54.2%. What's more, this paper divides the national economy into four departments (primary industry, secondary industry, tertiary industry except Real Estate, Real Estate). By using the same method, it deduces the correlation between the Real Estate and three industries are 0.0508, 0.6667, 0.6265 (including the correlation to itself 0.0306). The Real Estate influences the secondary industry more than the tertiary one.