Faculty of Business Administration
Visiting Scholar Seminar
Inequality hikes, saving surges, and housing bubbles
Prof. Qingbin ZHAO
Assistant Professor of Economics
Southwest University of Political Science & Law
Date: 27 November 2020 (Friday)
This paper uses theoretical and empirical models to analyze the effect of saving rates on housing prices under income inequality observed in fast-growing tourism resorts like Macao. The theoretical model predicts that rising inequality leads to larger asset bubbles through a higher rate of saving and a greater investment of saving in housing assets. The empirical model confirms that tourism growth and inequality spurt do foster saving surge and housing bubble. This work on Macao also shows that aggressive operation of VIP tourism and excessive use of foreign investment may be no good for economic efficiency and social equity. It is necessary for Macao to make full use of its ample public saving to pursue sustainable tourism development and autonomous economic growth. The government should spend a substantial portion of its idle saving to deal with social discontent over low real income and low housing affordability and to prevent the chaos of Hong Kong type from repeating in Macao.
Dr. Qingbin ZHAO is an Assistant Professor of economics from School of Economics, Southwest University of Political Science & Law. He has published four papers in Applied Economics Letters, Review of International Economics, Asia-Pacific Journal of Accounting & Economics, and International Review of Economics & Finance. He has also published a book chapter in《新时代新征程: “一带一路”与澳门发展》, 社会科学文献出版社(中国).