Housing price, financial development, energy intensity, FDI inflows: Global evidence

Abstract

We examine the long-run and short-run impact of energy financial development, energy intensity and FDI inflows on housing prices by employing an international sample of 35 countries over the period 1980-2018. Using the two-step system GMM approach, unit root and cointegration tests, our empirical results imply strong cointegration and cross-dependence between housing price, energy intensity, financial development and economic growth. The regression results indicate the consistent outcomes; however, the magnitude and relation between housing price, energy intensity, and financial development are volatile when we control for different economic indicators through various econometric approaches. The results lend further empirical evidence on the transmission and response of housing prices to different economic factors.