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How Housing Affects Stock Investment—An SEM Analysis

1
Chinese Academy of Finance and Development (CAFD), Central University of Finance and Economics (CUFE), Beijing 100081, China
2
China Academy of Public Finance and Public Policy (CAPFPP), Central University of Finance and Economics (CUFE), Beijing 100081, China
*
Author to whom correspondence should be addressed.
Economies 2019, 7(1), 26; https://doi.org/10.3390/economies7010026
Received: 15 January 2019 / Revised: 18 March 2019 / Accepted: 19 March 2019 / Published: 25 March 2019
(This article belongs to the Special Issue Real Estate and Finance)
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PDF [2393 KB, uploaded 28 March 2019]
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Abstract

The extant literature regarding the effects of housing on stock investment shows inconsistent findings, either positive or negative effects have been reported. This paper investigates the mechanisms by which housing affects household stock investment through a structure equation model (SEM). Applying the data from the China Household Finance Survey (CHFS), we confirm and quantify the magnitudes of contemporaneous “wealth effects” and “crowd-out effects” of housing on household equity investment. Overall, the combined effect of housing on stock investment is positive in the context of urban China. View Full-Text
Keywords: housing; stock investment; structural equation model; urban China housing; stock investment; structural equation model; urban China
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Li, J.; Zhao, J. How Housing Affects Stock Investment—An SEM Analysis. Economies 2019, 7, 26.

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