The Hedonic Price Function in a Matching Model of Housing Market
AbstractThis paper develops a theoretical model in which the matching framework à la Pissarides (2000) extended to the housing market is integrated with the hedonic price theory. Market tightness and selling price collectively determine the long-run equilibrium of the economic system in which a seller can become a buyer, and vice versa. As a result, the house price depends not only on the housing characteristics but also on the market tensions and bargaining power of the parties. This integration allows to overcome a major drawback of the hedonic price theory, namely the assumption of perfect competition.
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Bibliographic InfoArticle provided by AccessEcon in its journal Economics Bulletin.
Volume (Year): 31 (2011)
Issue (Month): 3 ()
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hedonic price theory; housing market; search and matching models;
Other versions of this item:
- Lisi, Gaetano, 2011. "The Hedonic Price Function in a Matching Model of Housing Market," MPRA Paper 32697, University Library of Munich, Germany.
- R2 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis
- R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location
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