The Research On The Impact Mechanism Of Rising House Prices On Firm Size Distribution

With the reform of the real estate market in 1998,China's real estate industry has entered a stage of rapid development.At the same time,the rapid rise in house prices has had an important impact on productive investment,innovation and entrepreneurship,corporate finance,final consumption and even the whole national economy,and has aroused extensive concern of the government and scholars.The firm size distribution can not only reflect the competitive situation and development pattern of an industry,but also have an important influence on the economic growth of a country,such as firm size distribution and innovation,total factor productivity.The analysis of the influence factors of the firm size distribution in the academic circles mainly focuses on the financing constraints and the institutional factors.But few literatures combine the two aspects to study the impact of house price rise on the real economy in the perspective of firm size distribution.The rise of house prices has a heterogeneous impact on different sizes of enterprises,rising housing prices inhibit the growth of small and medium-sized enterprises,but it is conducive to the expansion of large enterprises,which widened the gap between SMEs and large enterprises,making the firm size distribution become more uneven.This paper investigates the effects of the rise of the provincial level house prices on firm size distribution using the data of industrial enterprises,in the background of rapid rise of house prices from 1999 to 2007 in China.The results show that house prices were significantly negatively correlated with the firm size distribution.This indicates that the rising house prices is not conducive to uniform distribution of firm size.Estimated results based on the modified Pareto exponent and other indicators remain robust.Further study indicates that the cost effect of rising house prices pushes up the production cost of industrial enterprises,but its impact on SMEs enterprises is greater.The credit effect of rising house price increases the value of the collateral assets of industrial enterprises,such as land and plant building,which can alleviate the financing constraints of enterprises.But compared with SMEs,the rising house prices are more favorable to large enterprises.The rising house prices induce a large number of capital into the real estate market.Because of their strong strength,large enterprises have the ability to break through the necessary capital barriers,the barriers of land resources access and the administrative barriers.Obviously,the crowding-out effect has a greater impact on large enterprises.But at the same time,large enterprises have also gained more revenue from the real estate market,expanding at a faster rate.This paper is not only a useful supplement to the theoretical research on the firm size distribution,but also provides a new perspective for understanding the impact of rising house prices on the real economy,and provides a scientific basis for the government to make policy to mitigate the impact of rising house prices on the real economy.