Real Estate Valuation, Current Account, and Credit Growth Patterns Before and After the 2008–2009 Crisis

30 Pages Posted: 24 Jul 2013

See all articles by Joshua Aizenman

Joshua Aizenman

University of Southern California - Department of Economics; National Bureau of Economic Research (NBER)

Yothin Jinjarak

University of London - SOAS - Department of Financial and Management Studies

Date Written: July 23, 2013

Abstract

This paper explores the stability of the key conditioning variables accounting for real estate valuation before and after the crisis of 2008–2009, in a panel of 36 countries, for the period of 2005:I–2012:IV, recognizing the incidence of global financial crisis. Our paper validates the robustness of the association between the real estate valuation of lagged current account patterns, both before and after the crisis. The results are supportive of both current account and credit growth channels, with the animal-spirits and momentum channels playing the most important role in the boom and bust of real estate valuation.

Keywords: current account, real estate, credit supply, global crisis, housing boom

JEL Classification: F15, F21, F32, R21, R31

Suggested Citation

Aizenman, Joshua and Jinjarak, Yothin, Real Estate Valuation, Current Account, and Credit Growth Patterns Before and After the 2008–2009 Crisis (July 23, 2013). ADBI Working Paper 429. Available at SSRN: https://ssrn.com/abstract=2297708 or http://dx.doi.org/10.2139/ssrn.2297708

Joshua Aizenman (Contact Author)

University of Southern California - Department of Economics ( email )

3620 South Vermont Ave. Kaprielian (KAP) Hall, 300
Los Angeles, CA 90089
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Yothin Jinjarak

University of London - SOAS - Department of Financial and Management Studies ( email )

College Buildings
Russell Square
London, WC1H 0XG
United Kingdom

HOME PAGE: http://https://sites.google.com/site/yothinjinjarak/

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