Research On The Regional Differences Of The Impact Of Real Estate Prices On Inflation In China

Price stability,as one of the four major goals of China's macroeconomic regulation,has close relationship with the steady and healthy development of China's economy.Since the reform of the housing market in 1998,the rapid development of the real estate industry in China has profoundly affected all aspects of society and economy.The rapid rise in house prices not only affects China's aggregate demand and price levels through consumption and investment,but also has a huge impact on the effectiveness of China's monetary policy formulation and implementation.Therefore,it is very necessary to study the impact of real estate prices on inflation in this context.At the same time,taking into account China's vast territory and large differences in regional economic development levels,the analysis of regional differences will undoubtedly make research more relevant and realistic.Based on the analysis and summarization of domestic and foreign research status,firstly,it elaborates the transmission mechanism of real estate price on inflation from the theoretical level.Second,based on the analysis of the current situation of housing prices and inflation in China and other regions,This article use the panel data of 31 provinces in China to build a dynamic panel model for empirical research.Study the Regional Differences of the Impact of Real Estate Prices on Inflation in China by measurement methods such as unit root test,cointegration test,and GMM estimation.Finally,according the findings of the research institute,corresponding policy recommendations were put forward in light of the actual situation in each region.The conclusions of this paper are as follows: First of all,there are obvious differences in inflation across regions in China.Inflation in the eastern region is slightly lower than the national average.In the central and western regions,inflation is slightly higher than the national average and the difference is greater during the inflation period.Second,there is a long-term stable relationship between real estate prices and inflation in China.Whether at the national level or in regions,real estate prices have a significant positive effect on inflation.Finally,there are significant regional differences in the impact of real estate prices on inflation.The real estate price in the western region has the strongest positive effect on inflation,followed by the middle and the weakest in the east.The main innovations in this article as follows:First,the exploration of regionaldifferences.The current research on the impact of real estate prices on inflation in China is basically analyzed from the national macro level.This paper considers the existence of inter-regional heterogeneity.Do not analysis from the national level,instead,the three regions of the East,Central,and West of China are studied.The article analyse the regional differences in the impact of house prices on inflation,thus making the research more targeted.Second,the use of dynamic panel model.Previous studies mostly analyzed time series data by constructing VAR models.Based on regional differences and taking into account the inertial characteristics of inflationary changes,the paper uses dynamic panel data model for empirical analysis and research.