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Impact of the market power for commercial housing project on the trading premium: Micro evidence from Beijing
GUO Xiao-yang, LIU Hong-yu
Systems Engineering - Theory & Practice ›› 2013, Vol. 33 ›› Issue (4) : 829-839.
PDF(1159 KB)
PDF(1159 KB)
Impact of the market power for commercial housing project on the trading premium: Micro evidence from Beijing
The microscopic study of market structure is always one of the important research directions, the relevant studies of the degree and the influence of the market power, domestically, however, might be with much importance due to the significant characteristic of concentrated supply of housing by the developers. This paper estimates the price elasticity of demand for 1029 commercial housing project and, of which, the Lerner Index for 494 elastic ones using the micro-level data set from Beijing. Based on the estimated result, the spatial distribution of the degree of monopoly of the housing market in Beijing is derived, and the impact of market power on the housing trading premium is empirically tested. It is revealed that every one percent marginal increase of the market power will result in 0.83% increase of the premium, which is excellent robust over different segmentations of sub-market. Besides, an analysis perspective, based on the concept of elasticity, is provided helping to explain the phenomenon of unwillingness to sell in recent market.
housing market / market structure / market power / price elasticity of demand {{custom_keyword}} /
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