Land Prices and Housing Prices in China: An Empirical Study Based on the Game Theory

In this paper, the ten-year empirical data of housing system reform is used to research on the relationship between land prices and housing prices. By modeling the game between the local government and enterprises and exploring the interior mechanism between housing prices and land prices, this paper concludes that the long equilibrium of the game between the local government and real estate developers aims to raise the housing prices initiatively, while the role of the national macro-control is quite limited. In addition, from the perspective of the game between the government and enterprises, we find that it is land price that boosts the rise of housing prices, rather than the contrary.