The causal relationship between house prices and growth in the nine provinces of South Africa : evidence from panel Granger causality tests
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Date
Authors
Chang, Tsangyao
Simo-Kengne, Beatrice Desiree
Gupta, Rangan
Journal Title
Journal ISSN
Volume Title
Publisher
Inderscience
Abstract
This paper analyses the causal relationship between housing activity and growth in nine provinces of South Africa for the period 1995-2011, using panel causality analysis, which accounts for cross-section dependency and heterogeneity across provinces. Our empirical results support unidirectional causality running from housing activity to economic growth for most of the provinces studied; bi-directional causality between housing activity and economic growth for Gauteng; and no causality in any direction between housing activity to economic growth in Eastern Cape and KwaZulu-Natal. Our findings provide important insights for housing policies and strategies for South Africa. Specifically, housing sector might be an efficient growth-led instrument for all the provinces except Eastern Cape and KwaZulu-Natal.
Description
Keywords
House prices, Economic growth, Dependency and heterogeneity, Panel causality test, South Africa (SA)
Sustainable Development Goals
Citation
Chang, T, Simo-Kengne, BD & Gupta, R 2014, 'The causal relationship between house prices and growth in the nine provinces of South Africa : evidence from panel Granger causality tests', International Journal of Sustainable Economy, vol. 6, no. 4, pp. 345-358.