China's Housing Prices Of Rent-seeking Economic Analysis,

With the deepening of the Reform and Opening up and the perfecting of the market economy system, China's Real estate industry had been built a transition from practicing a planned economy system of the uniform construction and distribution to a comprehensive development with enterprises as the main body, market-oriented, based on social funds. Since the 1990s, the real estate industry has entered a period of unprecedented prosperity. As an important economic lever, it plays a tremendous role in urban construction, improving the people's living standard and promoting economic development, and haves a pivotal position in the whole economy. The real estate has been called as the sunrising industry, and became the leader of China's entering a new rapid economic growth cycle. However, in recent years, an "over-heated" phenomenon seems to appear in the Real estate market. Since 2004, Chinese house prices were soaring. Relative to low wages, the common people simply could not afford the high housing price, it is an extravagant hope for them to have their own house in large cities. The people's cozy life can not be safeguarded, which departures from the original intention of socialist construction. At the same time, the rampant house prices easily lead to a bubble economy, in case the bubble burst, serious financial crisis and the Great Depression will appear, the social instability will also be caused. Chinese government haves issued a series of measures to control the high prices, but could not still change the situation that the housing prices soar. Therefore, this paper aims to find the fundamental reasons of soaring housing prices, and propose a series of specific reform with a view to making the Real estate market maturer and making society more harmonious.There are also many papers on researching the rampant housing prices recently; these researchers mostly research the exterior factors impelling the housing prices up. This paper is studied on the basis of these researches, starting with the status quo of the China's Real estate industry, analyzing the carious factors led to housing prices rose one by one. Then I distill the essential and interior reason to impel the housing prices--rent seeking activities in the real estate industry, and enumerate these rent seeking behaviors. Besides, Client-Agent relationship, information asymmetry, the rational behavior analysis of Economic Man and the defects in the present system are quoted to analyze the reasons led to plenty of rent seeking behaviors. At the same time, I explain the effects of rent seeking behaviors on the real estate, people's life, even Chinese economy. Finally, I create a static economic model and drive the condition of the rent seeking behaviors producing, and use a comparative static analysis to exogenous variables in this static model, thereby get the dynamic conditions of baffling the rent seeking behaviors, namely reform by means of increasing the minimum of the palm grease that the officers want to take and decreasing the maximum of the palm grease that the Real estate developers want to present, and reform in allusion to the defects of the land property rights system, the land transfer system, Client-Agent relationship and the Real estate developing, supervising system.