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Monetary policy and regional price boom in Sweden

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  • Yang, Zan
  • Wang, Songtao
  • Campbell, Robert

Abstract

This study measures the heterogeneous effects of monetary policy on regional house prices in Sweden 1991-2002. We use a multivariate persistent shock metric to examine the impact of short-term interest rate on the property market. We also segregate the influence of interest rate shocks and influence of local shocks to capture their respective effects on regional price boom. We find significant regional effect of monetary policy on housing markets. Interest rate effects dominate the influence of local price innovations in the core economic regions in Sweden. We further discuss the monetary transmission channels and highlight political implications.

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  • Yang, Zan & Wang, Songtao & Campbell, Robert, 2010. "Monetary policy and regional price boom in Sweden," Journal of Policy Modeling, Elsevier, vol. 32(6), pages 865-879, November.
    • Handle: RePEc:eee:jpolmo:v:32:y::i:6:p:865-879
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    Cited by:

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    3. Zhang, Yanbing & Hua, Xiuping & Zhao, Liang, 2011. "Monetary policy and housing prices : a case study of Chinese experience in 1999-2010," BOFIT Discussion Papers 17/2011, Bank of Finland, Institute for Economies in Transition.
    4. Gustafsson, Peter & Stockhammar, Pär & Österholm, Pär, 2016. "Macroeconomic effects of a decline in housing prices in Sweden," Journal of Policy Modeling, Elsevier, vol. 38(2), pages 242-255.
    5. Shen, Chung-Hua & Lin, Kun-Li & Guo, Na, 2016. "Hawk or dove: Switching regression model for the monetary policy reaction function in China," Pacific-Basin Finance Journal, Elsevier, vol. 36(C), pages 94-111.
    6. Wadud, I.K.M. Mokhtarul & Bashar, Omar H.M.N. & Ahmed, Huson Joher Ali, 2012. "Monetary policy and the housing market in Australia," Journal of Policy Modeling, Elsevier, vol. 34(6), pages 849-863.
    7. repec:zbw:bofitp:2011_017 is not listed on IDEAS
    8. Ma, Qiang & Khan, Zeeshan & Chen, Fuzhong & Murshed, Muntasir & Siqun, Yang & Kirikkaleli, Dervis, 2023. "Revisiting the nexus between house pricing and money demand: Power spectrum and wavelet coherence based approach," The Quarterly Review of Economics and Finance, Elsevier, vol. 87(C), pages 266-274.
    9. Zhang, Yanbing & Hua, Xiuping & Zhao, Liang, 2011. "Monetary policy and housing prices: a case study of Chinese experience in 1999-2010," BOFIT Discussion Papers 17/2011, Bank of Finland Institute for Emerging Economies (BOFIT).
    10. Mohamad, Shaifulfazlee & Masih, Mansur, 2017. "What drives the property prices ? the Malaysian case," MPRA Paper 102411, University Library of Munich, Germany.
    11. Zan Yang & Shuping Wu & Yanhao Shen, 2017. "Monetary Policy, House Prices, and Consumption in China: A National and Regional Study," International Real Estate Review, Global Social Science Institute, vol. 20(1), pages 23-49.
    12. I-Chun Tsai, 2017. "The housing market and excess monetary liquidity in China," Empirical Economics, Springer, vol. 53(2), pages 599-615, September.
    13. I-Chun Tsai, 2015. "Monetary policy and bubbles in the national and regional UK housing markets," Urban Studies, Urban Studies Journal Limited, vol. 52(8), pages 1471-1488, June.

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