IDEAS home Printed from https://ideas.repec.org/a/ire/issued/v27n032024p361-371.html
   My bibliography  Save this article

Impact of North Korean Threats on Housing Prices in South Korea: A Research Note

Author

Listed:
  • Craig S. Galbraith

    (University of North Carolina Wilmington)

  • Edward Graham

    (University of North Carolina Wilmington)

  • Jake Lee

    (University of North Carolina Wilmington)

Abstract

Prior studies have uncovered a variety of exogenous events or activities that can impact the housing prices in a region. For more than seventy years, tensions between North Korea and South Korea have run high, and are sometimes violent. This study examines the impact that different threats have on housing prices in South Korea. Using three different measures of threats by North Korea, we examine housing prices in thirteen different city regions in South Korea. The results indicate a significant impact for three of the regions, regions that have a large United States military presence or are very close to the demilitarized zone. However, the study does not find a significant impact for the country of South Korea in general, or most of the regions studied.

Suggested Citation

  • Craig S. Galbraith & Edward Graham & Jake Lee, 2024. "Impact of North Korean Threats on Housing Prices in South Korea: A Research Note," International Real Estate Review, Global Social Science Institute, vol. 27(3), pages 361-371.
    • Handle: RePEc:ire:issued:v:27:n:03:2024:p:361-371
    as

    Download full text from publisher

    File URL: http://www.gssinst.org/irer/wp-content/uploads/2024/10/2-MS23092201-North-Korean-Threats-on-Housing-Prices-Galbraith.pdf
    File Function: Full text
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Zeynep Önder & Vedia Dökmeci & Berna Keskin, 2004. "The Impact of Public Perception of Earthquake Risk on Istanbul's Housing Market," Journal of Real Estate Literature, Taylor & Francis Journals, vol. 12(2), pages 181-194, January.
    2. Timothy Besley & Hannes Mueller, 2012. "Estimating the Peace Dividend: The Impact of Violence on House Prices in Northern Ireland," American Economic Review, American Economic Association, vol. 102(2), pages 810-833, April.
    3. Baabak Ashuri & Seyed Mohsen Shahandashti & Jian Lu, 2012. "Empirical tests for identifying leading indicators of ENR Construction Cost Index," Construction Management and Economics, Taylor & Francis Journals, vol. 30(11), pages 917-927, November.
    4. In Huh & Ju Hyun Pyun, 2018. "Does Nuclear Uncertainty Threaten Financial Markets? The Attention Paid to North Korean Nuclear Threats and Its Impact on South Korea's Financial Markets," Asian Economic Journal, East Asian Economic Association, vol. 32(1), pages 55-82, March.
    5. Elster, Yael & Zussman, Asaf & Zussman, Noam, 2017. "Rockets: The housing market effects of a credible terrorist threat," Journal of Urban Economics, Elsevier, vol. 99(C), pages 136-147.
    6. Scott Below & Eli Beracha & Hilla Skiba, 2017. "The Impact of Hurricanes on the Selling Price of Coastal Residential Real Estate," Journal of Housing Research, Taylor & Francis Journals, vol. 26(2), pages 157-178, January.
    7. Collins, William J. & Margo, Robert A., 2007. "The Economic Aftermath of the 1960s Riots in American Cities: Evidence from Property Values," The Journal of Economic History, Cambridge University Press, vol. 67(4), pages 849-883, December.
    8. Byung-Yeon Kim & Gérard Roland, 2014. "How credible is the North Korean threat?," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 22(3), pages 433-459, July.
    9. Chen, Andrew H. & Siems, Thomas F., 2004. "The effects of terrorism on global capital markets," European Journal of Political Economy, Elsevier, vol. 20(2), pages 349-366, June.
    10. Tanaka, Shinsuke & Zabel, Jeffrey, 2018. "Valuing nuclear energy risk: Evidence from the impact of the Fukushima crisis on U.S. house prices," Journal of Environmental Economics and Management, Elsevier, vol. 88(C), pages 411-426.
    11. Ansell, Ben, 2014. "The Political Economy of Ownership: Housing Markets and the Welfare State," American Political Science Review, Cambridge University Press, vol. 108(2), pages 383-402, May.
    12. Dibooglu, Sel & Cevik, Emrah. I., 2016. "The effect of North Korean threats on financial markets in South Korea and Japan," Journal of Asian Economics, Elsevier, vol. 43(C), pages 18-26.
    13. Chesney, Marc & Reshetar, Ganna & Karaman, Mustafa, 2011. "The impact of terrorism on financial markets: An empirical study," Journal of Banking & Finance, Elsevier, vol. 35(2), pages 253-267, February.
    14. James C. Murdoch & Harinder Singh & Mark Thayer, 1993. "The Impact of Natural Hazards on Housing Values: The Loma Prieta Earthquake," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 21(2), pages 167-184, June.
    15. Wenhao Xue & Xinyao Li & Zhe Yang & Jing Wei, 2022. "Are House Prices Affected by PM 2.5 Pollution? Evidence from Beijing, China," IJERPH, MDPI, vol. 19(14), pages 1-17, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Amine Ouazad, 2020. "Resilient Urban Housing Markets: Shocks vs. Fundamentals," Papers 2010.00413, arXiv.org, revised Oct 2020.
    2. Nowak, Adam & Sayago-Gomez, Juan, 2018. "Homeowner preferences after September 11th, a microdata approach," Regional Science and Urban Economics, Elsevier, vol. 70(C), pages 330-351.
    3. Park, Cheolbeom & Park, Suyeon, 2020. "Rare disaster risk and exchange rates: An empirical investigation of South Korean exchange rates under tension between the two Koreas," Finance Research Letters, Elsevier, vol. 36(C).
    4. Jung, Seungho & Lee, Jongmin & Lee, Seohyun, 2021. "The impact of geopolitical risk on stock returns: Evidence from inter-Korea geopolitics," MPRA Paper 108006, University Library of Munich, Germany.
    5. Stelios Markoulis, 2021. "Do Terror Attacks Affect the Euro? Evidence from the 21st Century," JRFM, MDPI, vol. 14(8), pages 1-24, July.
    6. Gok, Ibrahim Yasar & Demirdogen, Yavuz & Topuz, Sefa, 2020. "The impacts of terrorism on Turkish equity market: An investigation using intraday data," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 540(C).
    7. Baur, Dirk G. & Smales, Lee A., 2020. "Hedging geopolitical risk with precious metals," Journal of Banking & Finance, Elsevier, vol. 117(C).
    8. Brodeur, Abel & Yousaf, Hasin, 2019. "The Economics of Mass Shootings," IZA Discussion Papers 12728, Institute of Labor Economics (IZA).
    9. Kong, Dongmin & Xiong, Mengxu & Xiang, Junyi, 2021. "Terrorist attacks and energy firms' crash risk in stock markets: Evidence from China," Energy Economics, Elsevier, vol. 102(C).
    10. Chen, Yangyang & Goyal, Abhinav & Veeraraghavan, Madhu & Zolotoy, Leon, 2020. "Terrorist attacks, investor sentiment, and the pricing of initial public offerings," Journal of Corporate Finance, Elsevier, vol. 65(C).
    11. Yang, Jianlei & Yang, Chunpeng, 2021. "The impact of mixed-frequency geopolitical risk on stock market returns," Economic Analysis and Policy, Elsevier, vol. 72(C), pages 226-240.
    12. Ramiah, Vikash & Wallace, Damien & Veron, Jose Francisco & Reddy, Krishna & Elliott, Robert, 2019. "The effects of recent terrorist attacks on risk and return in commodity markets," Energy Economics, Elsevier, vol. 77(C), pages 13-22.
    13. Nguyen, Dat Thanh & Phan, Dinh Hoang Bach & Anglingkusumo, Reza & Sasongko, Aryo, 2021. "US government shutdowns and Indonesian stock market," Pacific-Basin Finance Journal, Elsevier, vol. 67(C).
    14. Cong S. Pham & Hoa Nguyen, 2024. "Impact of terror on international trade in financial services: Does the development of financial institutions matter?," The World Economy, Wiley Blackwell, vol. 47(6), pages 2476-2514, June.
    15. Nicholas Apergis & Matteo Bonato & Rangan Gupta & Clement Kyei, 2016. "Does Geopolitical Risks Predict Stock Returns and Volatility of Leading Defense Companies? Evidence from a Nonparametric Approach," Working Papers 201671, University of Pretoria, Department of Economics.
    16. Eleftherios Kourtis & Panayiotis Curtis & Michael Kourtis, 2020. "Spatial Differentiation of Urban Property Prices as a Repercussion in the Aftermath of a Civil Disorder Incident: The 2011 London Case," International Journal of Finance, Insurance and Risk Management, International Journal of Finance, Insurance and Risk Management, vol. 10(4), pages 3-24.
    17. Park, Jin Suk & Newaz, Mohammad Khaleq, 2018. "Do terrorist attacks harm financial markets? A meta-analysis of event studies and the determinants of adverse impact," Global Finance Journal, Elsevier, vol. 37(C), pages 227-247.
    18. Marc Rockmore, 2017. "The Cost of Fear: The Welfare Effect of the Risk of Violence in Northern Uganda," The World Bank Economic Review, World Bank, vol. 31(3), pages 650-669.
    19. Gupta, Rangan & Majumdar, Anandamayee & Pierdzioch, Christian & Wohar, Mark E., 2017. "Do terror attacks predict gold returns? Evidence from a quantile-predictive-regression approach," The Quarterly Review of Economics and Finance, Elsevier, vol. 65(C), pages 276-284.
    20. Paresh Kumar Narayan & Seema Narayan & Siroos Khademalomoom & Dinh Hoang Bach Phan, 2018. "Do Terrorist Attacks Impact Exchange Rate Behavior? New International Evidence," Economic Inquiry, Western Economic Association International, vol. 56(1), pages 547-561, January.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ire:issued:v:27:n:03:2024:p:361-371. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: IRER Graduate Assistant/Webmaster (email available below). General contact details of provider: https://www.gssinst.org/gssinst/index.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.