Capital Inflows and Property Prices: Ethnicity, Education, and Spillovers

75 Pages Posted: 22 Apr 2021

See all articles by Yuk Ying (Candie) Chang

Yuk Ying (Candie) Chang

Massey University

Sudipto Dasgupta

Chinese University of Hong Kong, ABFER, CEPR, and ECGI

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Date Written: January 30, 2021

Abstract

China has experienced significant capital flight over the last two decades. Despite anecdotal evidence that some of this capital has been invested in foreign residential markets, not much is known from academic research about its destination and impact. We examine the effects of capital inflows from China on residential property prices and the real economy in the U.S. and global metropolitan areas. We show that inflows had significant effects on residential property markets and employment in regions that (a) have strong ethnic ties to China and (b) are destinations of Chinese students. We document spillover effects to other regions.

Keywords: capital flight, housing prices, employment, deposits, ethnic ties, educational links, spillovers

JEL Classification: F20, F21, G12, G15, R00

Suggested Citation

Chang, Yuk Ying and Dasgupta, Sudipto, Capital Inflows and Property Prices: Ethnicity, Education, and Spillovers (January 30, 2021). Available at SSRN: https://ssrn.com/abstract=3831686 or http://dx.doi.org/10.2139/ssrn.3831686

Yuk Ying Chang

Massey University ( email )

Palmerston North
New Zealand

Sudipto Dasgupta (Contact Author)

Chinese University of Hong Kong, ABFER, CEPR, and ECGI ( email )

CUHK, Cheng Yu Tung Building, Room 1224
Shatin, NT
Hong Kong
Hong Kong

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