Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/222601 
Year of Publication: 
2018
Citation: 
[Journal:] Empirical Economics [ISSN:] 0377-7332 [Volume:] 55 [Issue:] 4 [Publisher:] Springer [Place:] Berlin [Year:] 2018 [Pages:] 1957-1983
Publisher: 
Springer, Berlin
Abstract: 
In the light of the unconventional monetary policies implemented by most large central banks around the world, there is an intense debate about the potential impact on the prices of capital assets. Particularly in Germany, skepticism about the sustainability of the current policy by the European Central Bank is wide spread and concerns about the emergence of a speculative price bubble in the housing market are increasing. The present study analyzes a comprehensive data set covering 127 large German cities from 1990 through 2013, using tests for speculative bubbles, both at a national and city level. Furthermore, we apply two new testing approaches: panel-data and principal components versions of explosive root tests. We find evidence for explosive price increases in many cities. However, it is only in select urban housing markets that prices decouple from their fundamental values. There is no evidence for speculative price movements nationally.
Subjects: 
housing prices
speculative bubble
explosive root
german cities
JEL: 
C21
C23
C53
Published Version’s DOI: 
Document Type: 
Article
Document Version: 
Accepted Manuscript (Postprint)

Files in This Item:
File
Size





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