The Estimation of Housing Investment in Urban Area of IRAN: A Tobin- Q Approach

It is increasingly recognized that Tobin’s conjecture that investment is a function of marginal Q is equivalent to the firm’s optimal capital accumulation problem with adjustment costs. Investment is one of the most important components of aggregate demand which play an important role in the economic fluctuations and economic growth. Therefore, from along time ago, Economist has intended to develop a model which can explain investment behavior and determine the most important factors that affect it. In the other hand, making decisions about investment are facing with tree important aspects which are prospects, lags and risks. It is not easy for economists to practice these aspects simultaneously by using the obtained data from financial markets. James Tobin solved this problems in his famous theory known as Tobin-Q method. From the macroeconomic viewpoint, in recent decades the housing sector, has been the most vibrant and dynamic part of the economic of Iran. In the last three decades of Iran’s economy, between 30 to 40 percent of total investment have been practiced in housing sector. The aim of this study is the analysis of the ratio of Tobin-Q in the housing investment in Iran. Estimate equations have been done by using an auto regressive Distributed lag method (ARDL) and also in order to investigate the shock and Analysis of variance, a vector Auto regressive (VAR) for seasonal data of the year 1370 - 1386 using microfit and Eviews have been practiced. Results in show in positive and significant effects of Tobin-Q ratio variable on the housing investment. Also real interest rate has no significant effect on the housing investment. Tobin-Q ratio is higher in long-term than short term that reflect the fact that, the expression investment started in the residential buildings are profitable. Also real interest rate has no significant effect on the housing investment.