Productivity assessment of the real estate industry in China: a DEA-Malmquist index

Abstract

PurposeThe high-quality development of the real estate industry is crucial to the transformation of China's economy. However, few studies apply the productivity to explore the development path of the real estate industry in China. To fill this gap, this study mainly investigates the total factor productivity (TFP) of the real estate industry of 30 sample provinces in mainland China from 2007 to 2016.Design/methodology/approachThe Malmquist index is applied to estimate the productivity (i.e. TFP) of the real estate industry, based on the data envelopment analysis (DEA). Then, the truncated tobit regression analysis explores the external influencing factors on the TFP of the real estate industry.FindingsThrough empirical analysis, it is found that the high-quality development of the real estate industry depends on the technological innovation by the real estate enterprises and the targeted policies by the provincial government. Moreover, the development of the real estate industry has a positive correlation with the growth of China's economy but a negative correlation with the development of other industries.Practical implicationsTFP mainly reveals the development status of the provincial real estate industry and identifies the driving force for exploring the high-quality development mode of the real estate sector. Furthermore, the fluctuation rule of TFP can be applied to predict the development trend of the real estate industry in the future.Originality/valueAs an application, this study measures the TFP of the Chinese real estate industry in different provinces and periods. The results have meaningful policy implications for policymakers regulating the real estate industry.

Exploring the Impact of Quantitative Easing Policy on the Business Performance of Construction Companies with the Debt Ratio as a Moderator

“…Yang, Fukuyama [34] studied the regional sustainability performance by the DEA method of the construction companies in 30 sample provinces in mainland China and based on these findings put forward some policy recommendations for the sustainable development of China's construction companies. Liu, Liu [17] explore the total factor productivity (TFP) of the construction industry of 30 provinces in China by the Malmquist index, one of the DEA methods to measure efficiency, from 2007 to 2016.…”

“…Some studies use Real Estate Investment Trusts (REITs) as Decision Making Units (DMUs) [10,11], while others use real estate and construction companies as their research DMUs [12][13][14][15]. There are also many studies that use provinces, states, or countries as DMUs to conduct efficiency research on the real estate and construction industries [16][17][18][19].…”

Exploring the Impact of Quantitative Easing Policy on the Business Performance of Construction Companies with the Debt Ratio as a Moderator

“…The income received from the operating activities of each construction company within the statistical year. 1000 TWD [15,16,18,20,21,30,33,[35][36][37]54,55] Market value…”

“…Some studies have used real estate investment trusts (REITs) as decision making units (DMUs) [13,14], while others have used real estate and construction companies as their research DMUs [15][16][17][18]. There have also been many studies that have used provinces, states, or countries as DMUs to conduct efficiency research on the real estate and construction industries [19][20][21][22].…”

A dynamic SBM‐DEA and portfolio formation test approach to the operating efficiency‐stock returns nexus

“…China's economy has transitioned from a stage of rapid development to one of high‐quality development since 2017 (Liu et al, 2021a). This growth, as an innovation‐driven mode of economic development, entails optimizing the industrial structure, improving the business environment, and promoting product quality while achieving economic growth.…”