Can the stock market boost economic growth? Evidence from the Mexican real estate investment trust (REIT)

Razo-De-Anda, Jorge Omar and Cruz-Aké, Salvador and Venegas-Martínez, Francisco (2022): Can the stock market boost economic growth? Evidence from the Mexican real estate investment trust (REIT). Published in: Panorama Económico , Vol. 17, No. 36 (1 June 2022): pp. 9-32.

Abstract

This paper develops a stochastic dynamic general equilibrium model to assess the impact of Real Estate Investment Trust (REIT) in the growth rate of the real estate sector through direct investment in infrastructure. Based on the theoretical relationships that the model provides we show empirical evidence, through a quantile econometric analysis of time series, of the positive impact of the REITs in the construction sector. The growth in the construction sector comes from the demand for real estate by those trusts, which would lead to a price increase, promoting gross fixed capital formation, and increasing the value of output in the construction industry.

• Item Type: MPRA Paper
• Language: English
• Keywords: real estate investment trust, real estate markets, financial markets, general equilibrium.
• Subjects: G - Financial Economics > G1 - General Financial Markets > G10 - General; G - Financial Economics > G1 - General Financial Markets > G11 - Portfolio Choice ; Investment Decisions

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