Construction of a Spatial Housing Price Index by Estimating an Almost Ideal Demand System
The aim of this article is to build a spatial housing price index for the Chilean communes (the commune political body similar to a municipality or county). The first step is to recover hedonic prices of three housing attributes by estimating a mixed index model (Bowden, 1992) using a generalized method of moments procedure. Secondly, a censored almost ideal demand system (Deaton and Muellbauer, 1980) is estimated to build expenditures for every commune and to compare them among different spatial units, while maintaining a constant utility level. Using micro data from the 2009 CASEN survey, we show that there are important differences in housing prices among Chilean communes and the axiomatic approach tends to understate spatial index compared to economic approach.
|Date of creation:||May 2011|
|Date of revision:||May 2011|
|Contact details of provider:|| Postal: Av. Angamos 0610, Antofagasta|
Phone: (55) 355-768
Fax: (55) 355-878
Web page: http://www.economiaucn.com
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Pierre-Philippe Combes & Gilles Duranton & Laurent Gobillon, 2008.
"Spatial Wage Disparities: Sorting Matters!,"
- Stephen Malpezzi, . "Hedonic Pricing Models: A Selective and Applied Review," Wisconsin-Madison CULER working papers 02-05, University of Wisconsin Center for Urban Land Economic Research.
- Halvorsen, Robert & Pollakowski, Henry O., 1981. "Choice of functional form for hedonic price equations," Journal of Urban Economics, Elsevier, vol. 10(1), pages 37-49, July.
- Edward L. Glaeser & Jed Kolko & Albert Saiz, 2000.
Harvard Institute of Economic Research Working Papers
1901, Harvard - Institute of Economic Research.
- W. Erwin Diewert, 1995. "Axiomatic and Economic Approaches to Elementary Price Indexes," NBER Working Papers 5104, National Bureau of Economic Research, Inc.
- Dusan Paredes, 2011. "A methodology to compute regional housing price index using matching estimator methods," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 46(1), pages 139-157, February.
- Eugenio Figueroa & George Lever, 1992. "Determinantes del precio de la vivienda en Santiago: Una estimación hedónica," Estudios de Economia, University of Chile, Department of Economics, vol. 19(1 Year 19), pages 67-84, June.
- Dusan Paredes & Patricio Aroca, 2008. "Metodología para Estimar un Indice Regional de Costo de Vivienda en Chile," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 45(131), pages 129-143.
- Heien, Dale & Wessells, Cathy Roheim, 1990. "Demand Systems Estimation with Microdata: A Censored Regression Approach," Journal of Business & Economic Statistics, American Statistical Association, vol. 8(3), pages 365-71, July.
- Roger J. Bowden, 1992. "Competitive Selection and Market Data: The Mixed-Index Problem," Review of Economic Studies, Oxford University Press, vol. 59(3), pages 625-633.
- Timmins, Christopher, 2006. "Estimating spatial differences in the Brazilian cost of living with household location choices," Journal of Development Economics, Elsevier, vol. 80(1), pages 59-83, June.
- Brasington, David M. & Hite, Diane, 2008. "A mixed index approach to identifying hedonic price models," Regional Science and Urban Economics, Elsevier, vol. 38(3), pages 271-284, May.
- Koo, Jahyeong & Phillips, Keith R. & Sigalla, Fiona, 1997.
"Measuring regional cost of living,"
9713, Federal Reserve Bank of Dallas.
- Heckman, James J, 1979.
"Sample Selection Bias as a Specification Error,"
Econometric Society, vol. 47(1), pages 153-61, January.
- Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
- Ricardo Lira, 1978. "Precios Implícitos de Características de Viviendas en Santiago," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 15(44), pages 67-90.
When requesting a correction, please mention this item's handle: RePEc:cat:dtecon:dt201101. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dusan Paredes)
If references are entirely missing, you can add them using this form.