Interest rate, Unemployment rate, and House Market in US

Jen-Shi Ni; Yu Wen; Shuen- Shi Huang
March 2011
International Proceedings of Economics Development & Research;2011, Vol. 5 Issue 1, p413
Academic Journal
The aim of this paper is to find out the relation between interest rate and unemployment rate variables with house market index in US, because global economic crisis due to sub-prime mortgage financial crisis in 2008. This paper use time series method of forecasting volatility of housing market index in the US. We construct VAR model including variables, housing market index, unemployment rate, consumer confidence index, the Dow Jones industrial index, FED interest rate and so on. We founded the house market index in US will be changed 11.7 due to unemployment rate,0.49 due to consumer confidence index, -11.04 due to FED interest rate, 0.3% due to Dow Jones industry index, per one unit change. There are also have long run stable relation between the variables.


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