EconStor >
Institut für Wirtschaftsforschung Halle (IWH) >
IWH-Diskussionspapiere >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/37069
  
Title:What happened to the East German housing market? A historical perspective on the role of public funding PDF Logo
Authors:Michelsen, Claus
Weiß, Dominik
Issue Date:2009
Series/Report no.:IWH-Diskussionspapiere 2009,20
Abstract:The paper analyses the development of the East German housing market after the reunification of the former German Democratic Republic and the Federal Republic of Germany in 1990. We analyse the dynamics of the East German housing market within the framework of the wellknown stockflow model, proposed by DiPasquale and Wheaton. We show that the today observable disequilibrium to a large extend is caused by postunification housing policy and its strong fiscal incentives to invest into the housing stock. Moreover, in line with the stylized empirical facts, we show that 'hidden reserves' of the housing market were reactivated since the economy of East Germany became market organized. Since initial undersupply was overcome faster than politicians expected, the implemented fiscal stimuli were too strong. In contrast to the widespread opinion that outward migration caused the observable vacancies, this paper shows that not weakness of demand but supply side policies caused the observable disequilibrium.
Subjects:housing market transition
housing subsidies
housing supply
East Germany
Transformation des Immobilienmarkts
Subventionen für Immobilien
Wohnraumversorgung
Ostdeutschland
JEL:D5
H2
R21
R28
R31
Appears in Collections:Publikationen von Forscherinnen und Forschern des IWH
IWH-Diskussionspapiere

Files in This Item:
File Description SizeFormat
618096973.pdf794,63 kBAdobe PDF
No. of Downloads:
last Month last 3 Month total
Show full item record
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/37069

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.