Leaning against house prices: A structural VAR investigation

Evidence from monetary VARs suggests that in the U.S., Canada, and U.K. impact of shocks on real house prices is about three to five times as large GDP. Although these trade-offs are not manifestly unfavorable, light differences magnitudes GDP fluctuations, a policy leaning against former would inevitably entail significant losses latter. I use identified order explore corresponding associated with weakly, but systematically prices. Results ‘modest’ (in sense Leeper Zha, 2003) counterfactuals suggest that, population, for all countries. Within specific context upsurge U.S. which pre-dated financial crisis, shortfall one per cent have been decline by four cent.