Economics at your fingertips  

On the Link between Value of the Dollar and Housing Production in the U.S.: Evidence from State Level Data

Mohsen Bahmani-Oskooee () and Seyed Hesam Ghodsi ()
Additional contact information
Seyed Hesam Ghodsi: Model Risk Oversight at Charles Schwab & Co. Inc.

International Real Estate Review, 2019, vol. 22, issue 2, 231-274

Abstract: Currency depreciation is said to affect domestic output in either direction, depending on the relative strength of its impact on next exports and the cost of imported inputs. Since increased net exports and eventual economic growth affect the demand for housing and increased cost of imported materials that are used in housing construction affects the supply of housing, we assume that currency depreciation could have an impact on housing output. We test our assumption by using time-series data from each of the states in the U.S. and show that when a linear model is estimated, dollar depreciation has short-run effects in 41 states and long-run effects in only three states. However, when dollar depreciation is separated from appreciation and a nonlinear model is estimated, we find short-run asymmetric effects in all of the states and long-run asymmetric effects in 32 states. Additional analysis reveals that while dollar depreciation increases housing output in 10 states, dollar appreciation hurts the output in 11 states, thus supporting the expansionary depreciation of the dollar in the U.S. housing market.

Keywords: House Permits; Exchange Rate; Asymmetry Analysis; The United States. (search for similar items in EconPapers)
JEL-codes: L85 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link) Full text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from
Asian Real Estate Society, 51 Monroe Street, Plaza E-6, Rockville, MD 20850, USA

Access Statistics for this article

International Real Estate Review is currently edited by Professor Ko Wang, Professor Hongyu Liu and Professor Rose Neng Lai

More articles in International Real Estate Review from Asian Real Estate Society Asia Real Estate Society, 51 Monroe Street, Plaza E-6, Rockville, MD 20850, USA.
Bibliographic data for series maintained by IRER Secretary Office/Webmaster ().

Page updated 2020-07-07
Handle: RePEc:ire:issued:v:22:n:02:2019:p:231-274