The Asset Approach to Pricing Urban Land: Empirical Evidence

Many papers have attempted to explain Intelmetropolitan variations in the price of housing using multi-equation models of the metropolitan housing market. This paper uses a long-run equilibrium urban asset model to explain such variations. The model builds upon previous models that introduce uncertainty into the dynamic urban model of land conversion. The empirical results strongly support the asset approach to valuing land in urban areas.     

Empirical tests of real estate market efficiency

Recent empirical research using real estate data has supported the weak and semi-strong forms of the efficient markets hypothesis. Previous studies have not included an estimate of expected appreciation into the tests of market efficiency, thus raising a question about the reliability of the results. We first use a market model to test for market efficiency with results similar to those reported by others. We next use a dynamic multiple indicator, multiple cause (DYMIMIC) model, which extracts a vector of expected appreciation from the price data, to test market efficiency. This approach produces superior results and a stronger conclusion about the efficiency of housing markets. The results indicate limited adjustment delays which can be explained by the existence of high transactions and search costs.     

The assessment: contracts and competition

A significant recent development has been the extension of marketprocesses to activities which were previously provided by thepublic sector. A central feature of newly privatised marketsis the emergence of widespread forms of contracting. Explicitcontracting is used where in the past transactions had takenplace internally within a public enterprise of a governmentdepartment. The design of efficient forms of contracting hasbeen an essential component of the development of new marketsand quasi-markets such as those in defence and health. Thispaper examines evidence of the structure of contracts and theextent to which they contribute to or detract from the efficientoperation of markets, discusses the role of contracts in somenewly emerging markets, and evaluates contracts in utilitieswhere regulation rather than competition policy is widespread.     

Book Reviews

Book reviews in this article: GOOD INDUSTRIAL RELATIONS John Purcell BRITAIN IN DECLINE Andrew Gamble ENGLISH CULTURE AND THE DECLINE OF THE INDUSTRIAL SPIRIT, 1850–1980 Martin J. Wiener MONDRAGON—AN ECONOMIC ANALYSIS Henk Thomas and Chris Logan THE RULE OF LAW T. Corfield