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Evidence on Rationality in Commercial Property Markets: An Interpretation and Critique / Patric Hendershott, Robert J. Hendershott, Bryan D. MacGregor.
- Format:
- Book
- Author/Creator:
- Hendershott, Patric.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w11329.
- NBER working paper series no. w11329
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Other Title:
- Evidence on Rationality in Commercial Property Markets
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2005.
- Summary:
- Periodic sharp sustained increases and then reversals in asset prices lead many to posit irrational price bubbles. The general case for irrationality is that real asset prices simply have moved too much given the future real cash flows the assets are reasonably likely to produce. A corollary for property is that observed mean reversion in real cash flows is not reflected in investor valuations, resulting in asset values being too high when real cash flows are high and vice versa. In this paper we interpret, critique and extend existing analyses of movements in real commercial property prices during the late 1980s and early 1990s.
- Notes:
- Print version record
- May 2005.
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