The Dynamic Correlation among Financial Leverage, House Price, and Consumer Expenditure in China

With the help of time-varying parameter vector autoregression with stochastic volatility (TVP-SV-VAR) model and Bayesian dynamic conditional correlational autoregressive heteroscedasticity (Bayesian DCC-GARCH) model, this study analyzes interaction mechanism correlation among financial leverage, house price, consumer expenditure (the survey data are collected from China’s National Bureau Statistics January 2000 to December 2019; on leverage Wind economic database, price commercial housing was calculated based sales volume area official website Statistics). Empirical results show that an increase in significantly increases prices reduces expenditure, a rise inhibits weakens raises stimulates prices. In addition, most relevant, followed by then price. Therefore, systematic analysis three variables has important practical significance for formulating appropriate policies stabilize promote growth expenditures. Specially, is factor hold back soaring shrinking expenditure. monetary macroprudential should be used deal order achieve balanced sustainable development macroeconomy China.