 Steering in the housing market: Incentive induced by the tax schemeKeyang Li, Jing Wu (), Jianwei Xing and Jubo Yan Regional Science and Urban Economics, 2023, vol. 103, issue C Abstract: Intermediaries play an important role in markets with asymmetric information by reducing search friction and uncertainty for buyers and sellers. However, when a conflict of interest arises, agents may not fully act on behalf of their clients. Using a unique dataset of both housing resale transactions and agent showing records from a major brokerage firm, we document the brokerage agents' steering behaviors induced by the differential treatment of certain housing units under the taxation scheme in China. Our results show that brokerage agents strategically promote the units that receive more favorable tax treatment because these units offer higher expected commissions. The steering efforts lead to better sales performances of the promoted houses and are highly correlated with the agents' ability and steering incentives. Buyers' viewing and purchasing decisions are significantly affected by agents’ steering. Keywords: Steering; Conflict of interest; Market intermediary; Housing market (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:regeco:v:103:y:2023:i:c:s0166046223000881 DOI: 10.1016/j.regsciurbeco.2023.103953 Access Statistics for this article Regional Science and Urban Economics is currently edited by D.P McMillen and Y. Zenou More articles in Regional Science and Urban Economics from Elsevier |
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