Monetary policy, construction sector output and housing prices in India: An emerging economy perspective
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[1] Centre for Development Studies, India
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- Localización: Applied econometrics and international development, ISSN 1578-4487, Vol. 11, Nº. 1, 2011, págs. 195-204
- Idioma: inglés
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Resumen
The study examines the impact of monetary policy along with relevant macro economic factors on the construction sector activities’ growth and housing prices in Indian context. The empirical result indicates that it is mainly commercial bank credit from supply side and rise in income in demand side have positive influences on the construction sector growth. Nevertheless, it observes a dominance of demand side over supply side factor contributing to shortages of housing. While examining the factors influencing housing prices, it finds overall inflation rate puts upward pressure and money supply puts downward pressure. This may be due to the fact that bank credit is operating from a supply side enabling increased supply of housing and thereby lowering the housing prices.
