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Taxes and the fundamental value of houses


  • Madsen, Jakob B.


This paper constructs a general equilibrium model of housing prices which can be used to analyze the effects of various taxes on house prices and housing stock. It is shown that taxes have effects on the housing market that are quite different from the effects generated from the conventional user-cost-based models. Empirical estimates for the US show that taxes are highly influential for house prices in the short run as well as in the long run.

Suggested Citation

  • Madsen, Jakob B., 2009. "Taxes and the fundamental value of houses," Regional Science and Urban Economics, Elsevier, vol. 39(3), pages 365-376, May.
  • Handle: RePEc:eee:regeco:v:39:y:2009:i:3:p:365-376

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    References listed on IDEAS

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    Cited by:

    1. Sarah Carrington & Jakob B. Madsen, 2011. "House Prices, Credit and Willingness to Lend," The Economic Record, The Economic Society of Australia, vol. 87(279), pages 537-557, December.
    2. Jakob B Madsen, 2011. "A Repayment Model of House Prices," Monash Economics Working Papers 09-11, Monash University, Department of Economics.
    3. Madsen, Jakob B., 2012. "A behavioral model of house prices," Journal of Economic Behavior & Organization, Elsevier, vol. 82(1), pages 21-38.


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