Document Type : Original Research


Department of Economics, Khomeinishahr Branch, Islamic Azad University, Khomeinishahr, Isfahan, Iran


Global, financial and regional integrations for developing countries that are not prepared to enter free trade can be the most effective way for gradual opening of national economies in such countries and merging of them in the global economy. On the other hand, the construction and housing sector needs macroeconomic capitals for up-to-dating, investment and increased employment in this sector that can attract other countries' capitals given the integration among countries and reduction of technology transfer barriers in the region which is finally led to increased production. Four dependent variables and four models are employed in the present study. Economic fluctuations are adopted from different indices of the economic sector. In the last step, the results are compared with each other indicating the innovative aspect of this study. The effect of financial integration and housing price on economic fluctuations is explored in the current study via GMM method during the time period 2000-2013. Given the obtained results, housing price causes to stimulate production and increase economic fluctuations. Similarly, integration has a positive effect on increased economic activities.  


Ambrogio Cesa-Bianchi, and Luis Céspedes, and Alessandro Rebucci (2013) "Capital Flows, House Prices and the Macroeconomy: Evidence from Advanced and Emerging Market Economies", This paper was presented at Housing, Stability and the Macroeconomy: International Perspectives conference, November 14-15 2013.
Ambrogio Cesa-Bianchi, and Luis Felipe Cespedes, and Alessandro Rebucci (2015) "Global Liquidity, House Prices, and the Macroeconomy: Evidence from Advanced and Emerging Economies", © 2015 International Monetary Fund, WP/15/23, IMF Working Paper, January 2015.
Andersson, K. & B. Turner. (2005). Housing Investments and Economic Growth. National Ekonomiska Insttutionen,Uppsala universitet.
Aymen Ben Rejeb, and Adel Boughrara (2015) "Financial integration in emerging market economies: Effects on volatility transmission and contagion", Borsa Istanbul Review xx (2015), PP. 1-19,, Available online at
Charles Goodhart and Boris Hofmann (2008) "House Prices, Money, Credit And The Macroeconomy", Working Paper Series, No. 888, APRIL 2008, or from the Social Science Research Network electronic library at
Coulson, E. & M.S. Kim. (2002). Residential investment, nonresidential investment and GDP. Real Estate Economics, 28(2), 233- 248.
Daniel Berkowitz and David N. DeJong (2003) "Regional Integration: An Empirical Assessment of Russia", Department of Economics University of Pittsburgh Pittsburgh, PA 15260, (Davidson Institute; University of Michigan), This revision: February 2003.    
Elena Loutskina and Philip E. Strahan (2012) "Financial Integration, Housing and Economic Volatility", Available at SSRN: or http://   
Gabriel Mougani (2012) "An Analysis of the Impact of Financial Integration on Economic Activity and Macroeconomic Volatility in Africa within the Financial Globalization Contexts", African Development Bank Group, Working Paper No. 144, February 2012.
Gholami, Roya (Roghieh) and xiaojia cuoand M.Dolores Ahon Higon and Sangyong Tomlee (2009); "Information and Communications Technology (ICT) International Spillovers", IEEE Transactions on Engineering Management, vol. 56, No.2, pp.329-340.
Green, R. (1997). Follow the leader: How Changes in Residential and Non-Residential Investment Predict Changes in GPD. Real Estate Economics, 25: 253-270.
Mayo, S.K. (1999). Theory and Estimation in the Economics of Housing Demand. Journal of Urban Economics, 11: 24-39.
Meen, G. (1995). Is Housing Good for the Economy?. Housing Studies, 10(3): 405.
Mills, E. (1987). Has the United States Overinvested in Housing? Journal of the American Real Estate and Urban Economics Association, 15: 601-616.
Paolo Gelain, and Kevin J. Lansing, and Caterina Mendicino (2013) "House Prices, Credit Growth, and Excess Volatility: Implications for Monetary and Macroprudential Policy", International Journal of Central Banking June 2013, PP. 219-276.
Simon N eaime (2005) "Financial Market Integration and Macroeconomic Volatility in The MENA Region: An Empirical Investigation", Working Paper 0431, Review of Middle East Economics and Finance, Vol. 3, Issue 3, 2005.