The Role of Digital Inclusive Finance in Weakening Real Estate Market Speculation

Abstract

A multitude of studies have extensively examined strategies for achieving sustainable development in the real estate market. As the pivotal component of land economy, the real estate market plays a crucial role in ensuring its sound operation. However, it is currently undergoing significant adjustments and grappling with rampant speculative activities, resulting in an alarming bubble. By scrutinizing the speculative motivations of different entities, we present a novel perspective on mitigating speculation. Our analysis reveals that digital inclusive finance effectively curbs residents’ and enterprises’ speculative behavior, as evidenced by diminished prevention motivation and investment substitution motivation. Utilizing data from 280 cities, this study measures real estate market speculation by establishing a model that the volatility of the housing market turnover, as a proportion of GDP, deviates from the actual housing demand transactions based on economic fundamentals. Furthermore, it investigates the relationship between digital inclusive finance and real estate market speculation, along with its spatial effects. The findings indicate that digital inclusive finance significantly curbs real estate market speculation and has a negative spatial spillover effect. This research provides a novel model and perspective for exploring real estate market speculation while positively impacting sustainable development within the real estate market.

Keywords

• real estate market
• sustainable development
• speculation
• digital inclusive finance
• spatial correlation
• SDM model