Open AccessBehavioural Economics and House Prices: A Literature Review
Author(s) -
Richard Whittle,
Thomas L. Davies,
Matthew Gobey,
John Simister
Publication year - 2014
Publication title -
business and management horizons
Language(s) - English
Resource type - Journals
ISSN - 2326-0297
DOI - 10.5296/bmh.v2i2.6262
Subject(s) - economics , behavioural economics , house price , behavioral economics , financial crisis , positive economics , financial economics , macroeconomics , microeconomics , econometrics
This paper investigates previous research, to examine ways in which behavioural economics helps us to understand how house prices are determined. In several respects, behavioural economics seems to be an improvement over neoclassical economics, regarding variations and trends in house prices. This paper analyses theoretical and empirical evidence – investigating topics such as loss aversion, house price bubbles, and herd behaviour. Historical perspectives (including the 2007/8 global financial crisis) are included, as well as differences between countries.