Research On Income Distribution Effect Of Real Estate Price Fluctuation

Since the implementation of the housing market reform in China in 1998,the real estate industry has achieved rapid development,and its influence on the national economy has become increasingly prominent and has gradually become a pillar industry for the development of the national economy.However,the rising housing prices in recent years have exceeded the affordability of many residents.According to the data released by the National Bureau of Statistics,from 2003 to 2016,China’s GINI is above 0.46,which shows that the Chinese income gap is relatively large.And the Gini coefficient is so high that the resident’s life and social stability are negatively affected.Moreover,the overall upward trend of domestic housing prices and the gradual widening of income between urban and rural residents have almost occurred simultaneously.In order to better understand the relationship between housing price volatility and income distribution between urban and rural residents,that is,whether housing price fluctuations will affect the income distribution for residents and whether the unequal income distribution of residents will further affect housing price fluctuations,many scholars have conducted researches on their relationship in some way.Firstly,this paper combs the relevant literature at home and abroad,and the results are mainly manifested in two situations.And among these researches,some scholars think that there is a two-way relationship between housing prices and income gap,but other scholars believe that there is only one-way relationship between house price and income gap.Based on the relevant literatures at home and abroad,this paper expounds the concepts of house price,house price fluctuations,and the effect of income distribution on housing price fluctuations.Furthermore,in terms of theory,this paper analyzes the influence mechanism between housing prices and income distribution.this paper constructs a multiple regression model including housing prices and urban Gini coefficient within concrete empirical test,proving that housing price fluctuations have a positive impact on the income gap between urban and rural residents.Furthermore,based on the national housing prices form 1998 to 2016 and time series data of urban and rural Gini coefficient,this paper establishes a vector autoregressive(VAR)model to make empirical analysis for the relationship of income distribution between urban and rural residents.The results show that housing price fluctuations have effects on income distribution.In addition,in the short term,the rising housing prices have a strong positive effect on the expansion of the income gap and vice versa,and there is also an interaction between housing price volatility and income distribution.