Latest Research Papers

  • Is This Time The Same? Housing Market Performance during SARS and COVID-19

Research Projects

Market Power in Hong Kong’s First-Hand Property Market

PI: Kelvin Wong

The first-hand property market in Hong Kong is dominated by a small number of developers (sellers) with almost no new entrants over the past two decades. This market structure, especially the major developers, is often blamed to be the culprit of high property prices. However, since property is a durable good, the first-hand market is arguably competing with the second-hand market characterized by many individual sellers. In light of this, this study aims to empirically identify the conditions under which developers have market power to charge a price higher than the more competitive second-hand market.

The Resale Market of Subsidized Housing: Pricing and Liquidity

PI: Kelvin Wong

In Hong Kong, the subsidized housing market, known as Home Ownership Scheme (HOS), has been running in parallel with the private housing market since the 1970s. After purchasing HOS units from the government at a discount, owners have the right to use the units on their own, but their right to re-sell the units freely is subject to payment of a fee to the government. This fee is not fixed but grows with house prices, as if the fee were paid to redeem government’s equity share. This study aims to investigate how this unique institutional setting affects the resale of subsidized housing in terms of pricing and liquidity.

Transaction Taxes: Stabilize Or Destabilize The Real Estate Market?

PI: Kelvin Wong

While the primary purpose of taxation is to finance government expenditures, transaction taxes, which are levied ad valorem at the time a good is transacted, can also be used as a policy instrument to maintain economic stability. The stabilization motive is particularly strong when it comes to real estate because any extreme price movements will greatly affect households’ wealth and affordability. This study seeks to investigate whether imposing a transaction tax can stabilize real estate prices. It also examines the role of short-term investors – are they uninformed traders who bring noise to a market or informed traders who provide liquidity to other market participants?

Urban Network Capital: How Do Chinese Cities Grow In a Networked Economy?

PI: Kelvin Wong and Alex Shi

After decades of rapid growth, China’s economy is entering a consolidation phase in which industrial restructuring activities are intensified. Enormous capital flows between cities have created an inter-urban network that becomes intriguing and significant to understand China’s urban dynamics in the new development era. This study seeks to investigate whether urban growth is driven by a networked economy through the Mergers and Acquisitions (M&A) of firms. In particular, urban network capital is used as a construct to capture the city-to-city connections that enable virtual, rather than physical, exchange of information, thoughts, knowledge and capital.  

The Rise of Healthy Buildings: Economic Assessment with a Novel Dataset

PI: Michael Wang
Collaborator(s): Kelvin Wong and Tingyu Zhou

Human beings spend around 90% of their time indoors, but indoor spaces may expose their occupants to health risks (e.g., COVID-19). Even energy-efficient buildings (i.e., “green buildings”) are not exempt from health issues. This project will provide the first-ever academic insights into the economic incentives that affect the supply of healthy spaces in commercial buildings. The findings of this research will help policymakers and investors explore policy measures that reduce information asymmetry, providing prospective investors and tenants with a credible signal regarding the impact of the built environment on health.

The Nexus of Financial and Urban Landscapes: How does Venture Capital Reshape China’s Entrepreneurship?

PI: Alex Shi and Kelvin Wong

Undoubtedly, the economic vitality of a city relies heavily on local entrepreneurial activities. Cities are competing with each other to attract entrepreneurs to come and establish new ventures, particularly during China’s economic transition period. However, one question remains unanswered. Are all startups good for urban economic growth? Previous studies assume that when startups stay together, knowledge spillovers and innovations will emerge. Is this true across different cities in China? We need address this question in case resources are not efficiently distributed to support high-quality entrepreneurship. Technically, we will borrow venture capitalists’ criteria to assess startups’ potential and utilize alternative big data such as remoting sensing and street images to unveil the dynamic change of startup clusters, ultimately disentangling the relationship between startups and urban economy.

The Spatial Generating Mechanism and Systematic Synergies of Urban Network Capital

PI: Alex Shi

Previous studies have documented that innovations are created in a network space where market actors actively interact and exchange their ideas. However, along with deepening labor division and intensifying economic relations, economic relation networks are too complex to unravel its driving mechanisms. If urban economic growth is a function of corporate relations, it is very important to identify key actors and essential linkages that support the “skeleton” of complex networks and make multiplying effects on local economy. Technically, we will use machine learning methods to unveil the generating mechanism of capital and knowledge flow networks. More importantly, we aim to elucidate the interactive mechanism between capital and knowledge networks by using an unsupervised deep learning method.