THE REAL ESTATE BUBBLES AND MONETARY POLICY - THE US CASE

• Authors: Belke Ansgar , Wiedmann Marcel
• Languages of publication: EN

Abstracts

EN

This paper attempts to provide an answer on the question - whether the recent surge in the US real estate prices is fundamentally driven, or whether the current situation reflects the 'bubble' symptoms. Implicitly, also monetary policy in the euro area in these days is addressed as well with France and Spain experiencing exorbitant price increases of the real estate during at least the last four years. Our aim is to divide the valuation of the US housing market into a 'bubble' component and into a fundamentally justified component. For this purpose, the US real estate market and its peculiarities are described and the empirical indications of a bubble are identified. We contrast the empirical results with the ongoing question whether the asset prices and the asset price bubbles are and should be a matter of attention of the central bank authorities in the process of the monetary policy making.

Keywords

EN

ASSET PRICES; INFLATION; MONETARY POLICY; REAL ESTATE

Discipline

• ECONOMICS: ECONOMICS

• Publisher: Institute of Slovak and World Economics and Institute for Forecasting, Slovak Academy of Sciences
• Journal: Ekonomický časopis (Journal of Economics)
• Year: 2006
• Volume: 54
• Issue: 9
• Pages: 898-917
• Document type: ARTICLE

Contributors

author

Belke Ansgar

author

Wiedmann Marcel

• A. Belke, Ekonomicky ustav SAV, Sancová 56, 811 05 Bratislava 1, Slovak Republic

Identifiers

CEJSH db identifier

07SKAAAA02074422