Equilibrating ripple effect, disturbing information cascade effect and regional disparity – A perspective from China's tiered housing markets

Xiao, Qin

Abstract

The current study investigates the role of the tier-one cities of China in affecting regional disparities within and across its five mega-city clusters, through the lens of housing market. For that purpose, an equilibrating ripple effect is differentiated from a disturbing information cascade effect. Evidence suggests that a modest slow-moving equilibrating force originated from Hong Kong has flowed across all tier-one and most tier-two cities in the mainland, indicating a narrowing of regional inequalities between Hong Kong and the mainland cities. On the other hand, a powerful disturbing force emanated from Beijing has affected all other cities, widening the inequality gap in between. The Impulse response functions further suggest that this disturbing force has a permanent impact on regional disparity.

Citation

Xiao, Q. (in press). Equilibrating ripple effect, disturbing information cascade effect and regional disparity – A perspective from China's tiered housing markets. International journal of finance & economics : IJFE, https://doi.org/10.1002/ijfe.2453

• Journal Article Type: Article
• Acceptance Date: Dec 20, 2020
• Online Publication Date: Jan 3, 2021
• Deposit Date: Jan 4, 2021
• Publicly Available Date: Jan 4, 2023
• Journal: International Journal of Finance & Economics
• Print ISSN: 1076-9307
• Electronic ISSN: 1099-1158
• Publisher: Wiley
• Peer Reviewed: Peer Reviewed
• DOI: https://doi.org/10.1002/ijfe.2453
• Keywords: City house price; Economic geography; Information cascade effect; Regional disparity; Ripple effect
• Public URL: https://hull-repository.worktribe.com/output/3686889
• Publisher URL: https://onlinelibrary.wiley.com/doi/10.1002/ijfe.2453