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Credit, housing prices, expectations, and the macroeconomy. Evidence from developed and developing countries

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  • Priti Mendiratta ARORA

    (Maitreyi College, University of Delhi, India)

  • Hema KAPUR

    (Hansraj College, University of Delhi, India)

  • Ananya Ghosh DASTIDAR

    (Delhi University South Campus, India)

Abstract

The interlinkages between housing and credit markets can be critical for financial and overall macroeconomic stability. This paper empirically examines the impact of housing prices and expectations on debt buildups. These linkages are analyzed for a set of 41 countries that includes 28 developed and 13 developing countries using dynamic panel estimation over the sample period from 1997:Q1 to 2020:Q1. The findings indicate that the amount of credit generated in an economy is significantly related to housing and equity prices (indicators of sentiments and expectations) in developed and developing economies.

Suggested Citation

  • Priti Mendiratta ARORA & Hema KAPUR & Ananya Ghosh DASTIDAR, 2023. "Credit, housing prices, expectations, and the macroeconomy. Evidence from developed and developing countries," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(3(636), A), pages 165-182, Autumn.
    • Handle: RePEc:agr:journl:v:3(636):y:2023:i:3(636):p:165-182
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    References listed on IDEAS

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