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Review of Middle East Economics and Finance

Ed. by Dibeh, Ghassan / Assaf, Ata / Cobham, David / Hakimian, Hassan / Henry, Clement M.

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The Impact of Financial Development on Homeownership and Housing in Emerging Economies: Evidence from Turkey

Tansel Yilmazer / Fikret Adaman / Mehmet Kaytaz
Published Online: 2012-10-31 | DOI: https://doi.org/10.1515/1475-3693.1409


This paper aims to investigate the role of financial development on homeownership and housing in emerging economies. We construct a measure of regional financial development using data from the Survey of Consumer Finances in Turkey. Specifically, we estimate regional effects on the probability that a household does not have access to credit (i.e., are discouraged from applying for credit or their application was denied), and use these estimates to create an indicator of financial development. We find that homeownership increases with financial development in metropolitan areas. Home values, however, increase with financial development in both metropolitan and non-metropolitan areas. Our findings are robust to correction of potential endogeneity of our financial development measure. Our results are also robust to using the variation in the supply of credit across provinces as another measure of financial development.

Keywords: financial development; homeownership; borrowing; discouraged borrowers

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Published Online: 2012-10-31

Citation Information: Review of Middle East Economics and Finance, Volume 8, Issue 2, Pages 1–29, ISSN (Online) 1475-3693, DOI: https://doi.org/10.1515/1475-3693.1409.

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©2012 Walter de Gruyter GmbH & Co. KG, Berlin/Boston. Copyright Clearance Center

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