Jayantha, W M and Ganesan, S (2002) Econometric analysis of office space market's response to service sector growth in Hong Kong. Journal of Financial Management of Property and Construction, 7(3), pp. 175-196. ISSN 1366-4387
Abstract
Within the services sector in Hong Kong, the finance, insurance and real estate (FIRE) and business services sub-sector is the most influential and also the major source of generating demand for office space in the economy. This paper examines how the rapid expansion of the FIRE and business service sub-sector influences office building construction. Using the Engle-Granger (1987) methodology for cointegration and error correction mechanism (ECM), the causal relationships between growth of each of three sub-sectors of the services sector and the office space construction, were explored. Results of ECM suggest that the impact of changes in FIRE and business service sector growth on office construction is delayed, showing a lead-lag relationship. A multiple regression analysis, incorporating all other relevant variables including FIRE and business service sector, also confirm the delayed impact of FIRE and business service sector growth on office construction. Space per employee, as an influential determinant of office space construction is also found to be significant. The study also reveals that the growth of the FIRE and business service sector has influenced office space in the short term in terms of space usage patterns, and the type and location of office space.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | structural change, office market, Granger causality, error correction model, space per employee, centralization, decentralization, Hong Kong |
| Index terms: | cointegration, office construction, methodology, multiple regression analysis, decentralization, Hong Kong, office space, error correction model, office building, insurance, real estate, determinant, econometric |
| Subjects: | statistical analysis, political science, real estate economics, risk assessment, building construction, Geography, research methods, economic analysis, construction type |
| Topics: | Design Practice, Urban Studies, Business Strategy, Research Practice, Construction Technology, Governance, Geographical Context, Risk Management |
| Descriptive scope: | 4 PCTA |
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