Tax Incentives and House Price Volatility in the Euro Area Theory and Evidence
A problem associated with inflation differentials in monetary unions is that the "crowding-in" effect of lower real interest rates associated with high inflation will initially outweigh the loss of competitiveness (crowding out). The crowding-in effect may produce volatility in house price...
| Main Author: | |
|---|---|
| Format: | eBook |
| Language: | English |
| Published: |
Paris
OECD Publishing
2003
|
| Series: | OECD Economics Department Working Papers
|
| Subjects: | |
| Online Access: | |
| Collection: | OECD Books and Papers - Collection details see MPG.ReNa |
| Summary: | A problem associated with inflation differentials in monetary unions is that the "crowding-in" effect of lower real interest rates associated with high inflation will initially outweigh the loss of competitiveness (crowding out). The crowding-in effect may produce volatility in house prices, especially if tax regimes favour the occurrence of bubbles. This paper shows that this is the case notably in the smaller countries of the euro area, and this could explain the persistence of inflation differentials in the area to some extent .. |
|---|---|
| Physical Description: | 16 p. 21 x 29.7cm |