United Kingdom: Selected Issues

Author: International Monetary Fund

Volume/Issue: Volume 2003 Issue 047

Publication date: March 2003

ISBN: 9781451814170

$20.00

Add to Cart by clicking price of the language and format you'd like to purchase

Available Languages and Formats


English

Prices in red indicate formats that are not yet available but are forthcoming.

Topics covered in this book

This title contains information about the following subjects. Click on a subject if you would like to see other titles with the same subjects.

Inflation , Investments and Securities-General , Economics- Macroeconomics , ISCR , CR , right , price , investment , nominal interest rate , productivity gap , equipment investment , U , K , productivity performance , investment ratio , U , K , ratio , U , K , investment , Housing prices , Total factor productivity , Labor productivity , Capital productivity , Europe , Australia and New Zealand

Also of interest

Peru

Grenada

Nepal

Republic of Congo : 2001 Article IV

Summary

This Selected Issues paper examines the factors determining housing prices in the United Kingdom. Based on econometric evidence, the paper assesses whether recent housing price increases can be explained by fundamentals or whether they represent a temporary overshooting of housing prices, characteristic of a bubble. The paper estimates a simple error-correction model that describes the dynamics of real housing prices since the 1970s. Estimation results suggest that earnings and interest rates are the key determinants of housing prices, and that changes in real housing prices exhibit a large degree of persistence.