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Effect of information disclosure reform on market stability: Evidence from the housing market in Taiwan

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  • Hsieh, Yi-Shan
  • Yang, Chien-Wen

Abstract

This study examines how mandatory information disclosure policies affect market stability in Taiwan's housing market. In the existing-home mortgage market, disclosure increases financial stability (lower nonperforming loan ratios). The mechanism differs across regions: municipalities experience a direct effect through improved lending decisions, while non-municipalities benefit indirectly from higher information quality and lower price dispersion. In contrast, in the primary presale housing market, disclosure is linked to more disputes. This outcome may arise from information overload and the crowding out of private sources. These findings suggest that disclosure works differently across markets. Its effectiveness depends on participants' ability to process information, implying that policymakers should design policies suited to market needs and provide support through financial education or user-friendly platforms.

Suggested Citation

  • Hsieh, Yi-Shan & Yang, Chien-Wen, 2026. "Effect of information disclosure reform on market stability: Evidence from the housing market in Taiwan," Economic Modelling, Elsevier, vol. 155(C).
    • Handle: RePEc:eee:ecmode:v:155:y:2026:i:c:s0264999325004456
    DOI: 10.1016/j.econmod.2025.107450
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    Keywords

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    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • K25 - Law and Economics - - Regulation and Business Law - - - Real Estate Law
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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