Is construction or real estate sector a pillar industry of the national economy? The Chinese government once declared real estate sector as a pillar industry of the national economy in 2003. And some scholars argued that real estate sector is not a pillar industry .How about other countries? WHY is or isn’t it be? e
as a driver of the economy - why not? ... but in the long term ... probably not. As for the development of the economy through real estate - I do not remember such countries, and is it necessary? In a capitalist society, with an increase in demand, there will still be an imbalance - since this sector cannot quickly respond to the conjuncture. Roosevelt pulled the US economy out of depression by developing infrastructure, but the automotive industry became the driver ... Is this suitable for China?
Real estate sector could be driver of the economy in short-run, however, in the long run the major concern is that if its demand declines it would impede growth process, for example, Rogoff and Yang (2021), in their baseline calibration, using input–output tables and taking account of the very large footprint of housing construction and real estate related sectors, found that the adjustment to a decline in housing activity can easily trim a cumulative 5–10 percent from the level of output over a period of years. Likewise, my co-authors and I, in our recent study find that the Chinese real estate sector, which plays a key role in value chains, is highly dependent on its own final demand and a fall in its demand would impede economic development. An important implication of these results is that developing the national economy by stimulating the real estate sector would not be as effective as developing the real estate sector through stimulating the national economy.
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