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Housing and the Great Depression

  • Mehmet Balcilar

    (Eastern Mediterranean University)

  • Rangan Gupta

    (University of Pretoria)

  • Stephen M. Miller

    (University of Nevada, Las Vegas and University of Connecticut)

This paper considers the role of the real housing price in the Great Depression. More specifically, we examine structural stability of the relationship between the real housing price and real GDP per capita. We test for structural change in parameter values, using a sample of annual US data from 1890 to 1952. The paper examines the long-run and short-run dynamic relationships between the real housing price and real GDP per capita to determine if these relationships experienced structural change over the sample period. We find that temporal Granger causality exists between these two variables only for sub-samples that include the Great Depression. For the other sub-sample periods as well as for the entire sample period no relationship exists between these variables. JEL Classification: C32, E32, R31 Key words: Great Depression, Real House Price, Real GDP per Capita, Structural change

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Paper provided by University of Connecticut, Department of Economics in its series Working papers with number 2012-47.

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Length: 39 pages
Date of creation: Nov 2012
Date of revision:
Publication status: Forthcoming in Applied Economics
Handle: RePEc:uct:uconnp:2012-47
Note: Stephen Miller is corresponding author
Contact details of provider: Postal: University of Connecticut 365 Fairfield Way, Unit 1063 Storrs, CT 06269-1063
Phone: (860) 486-4889
Fax: (860) 486-4463
Web page: http://www.econ.uconn.edu/

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