2020, Volume 73 - Issue 3
RSS feed citation: At RePEc
Publication date: 17 August 2020
STRUCTURAL REFORMS IN THE EUROPEAN UNION: WHAT IS NEW AFTER THE CRISIS?Read the article
EXCHANGE RATE VOLATILITY AND ITS IMPACT ON CHINA'S TRADE WITH THE UNITED STATESRead the article
ASYMMETRIC PANEL CAUSALITY TESTS WITH AN APPLICATION TO THE IMPACT OF FISCAL POLICY ON ECONOMIC PERFORMANCE IN SCANDINAVIARead the article
Sadeq ABUL, Independent Economic Advisor
Ahmad M. AL-KANDARI, Department of Insurance and Banking, College of Business Studies, State of Kuwait
This study examines the short-run and dynamic long-run relationship between the real estate market and four selected macroeconomic variables in Kuwait. These macroeconomic variables include: Money Supply (M2), the Kuwait Main Market Index of Kuwait Stock Exchange (KSEI), the One-month Interest Rate on deposits (INTR) and oil prices (OIL). By using the ARDL model and ECM, this study finds evidence that M2 has a strong correlation with the real estate market in Kuwait in both runs, while oil prices have negative influences in the short-run but robust positive impacts in the long-run relationship. No significant relationship was found between real estate market and the Kuwaiti stock market index in the short- or long-run. However, in the long-run, the interest rate has a negative relationship with the real estate market. The results obtained from this study show that, if the system moves away from equilibrium, this will be corrected in the long run by 98% from departure for each period. There is evidence of long-run causality between the real estate market in Kuwait and the money supply, oil prices and the interest rate.
D1, D4, D19, L1, R310
Real-Estate, ARDL, ECM, OIL, M2, Kuwait
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