Research on the Dynamic Adjustment Relationship Between Housing Price and Land Price

The purpose of this paper is to study the dynamic adjustment relationship between housing price and land price in order to provide supports for the policy-making decisions of government.Methods employed include threshold co-integration theory,EGARCH Model and empirical analysis.The results indicate that:(1)the housing price is positively correlated with the land price;(2)the land price variation is the Granger-cause for housing price variation,and there is the co-integration relationship between land price and housing price;(3)the adjusted regression coefficients of the land price and housing price are asymmetric when they are deviating from the equilibrium.It is concluded that the different reactions of the house buyers and the property developers with thebear newsandbull newsin the housing market,the benefit game between the central and local governments,and the so-called selectively implementing real estate polices by the relevant interest groups are the causes of asymmetry adjustment.Lastly,several policy suggestions have been put forward,including the improvement of land auction system,balancing of the financial resources between the central and local governments,optimization of the standards of performance assessment for officials on different levels,and the enhancement of monitoring the implementation of real estate policies of local governments,etc.