Read full paper at: http://www.scirp.org/journal/PaperInformation.aspx?PaperID=53209#.VLcnX8nQrzE Author(s) Gieyoung Lim Affiliation(s) Department of International Economics & Law, Hankuk University of Foreign Studies, Seoul, South Korea . ABSTRACT The primary purpose of this paper is to construct and estimate an econometric model for the Jonsei-to-Purchase price ratio (JPR), and to draw implications for the development in the Korean housing market. In particular, we are interested in: a) identifying regimes across which the ratio shows markedly different dynamic behavior; and b) drawing implications from the model for the recent increases in the ratio. Estimation of the model for the period 1987:Q1-2011:Q3 confirms the presence of two different regimes: one with the zero trend in the JPR, and the other with positive trend. Furthermore, it is found that cyclical variations play nontrivial role only in the first regime, wh...
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