Analysis of the Game Behavior of Real Estate Mortgage Securities Issuers Based on Reciprocal Preferences

Research Article
Open access

Analysis of the Game Behavior of Real Estate Mortgage Securities Issuers Based on Reciprocal Preferences

Tian Tan 1*
  • 1 The University of Sheffield    
  • *corresponding author 15060140320@xs.hnit.edu.cn
Published on 10 November 2023 | https://doi.org/10.54254/2754-1169/30/20231458
AEMPS Vol.30
ISSN (Print): 2754-1177
ISSN (Online): 2754-1169
ISBN (Print): 978-1-83558-081-3
ISBN (Online): 978-1-83558-082-0

Abstract

In recent years, the Chinese government has gradually begun to pay attention to the development of real estate investment trusts (REITs) and hopes to use REITs to increase the securitization of assets in the real estate market, making it possible to accelerate the circulation of funds in the real estate market. In order to enable issuers to price REITs effectively to form a mutually beneficial transaction model with investors, to increase the willingness and success rate of both parties and to ultimately create a harmonious and efficient REITs market, it is important to study the pricing decisions of issuers when issuing REITs. This study analyzes and investigates the issue of pricing decisions of REITs based on reciprocal preferences and evolutionary game theory. It is found that when the proportion of REITs issuers choosing to construct a reciprocal initial pricing decision is greater than the equilibrium probability of REITs issuers choosing a reciprocal pricing strategy, and when the initial proportion of investors choosing a reciprocal investment decision is greater than the equilibrium probability of investors choosing a reciprocal investment strategy, the overall REITs transaction market tends to be a reciprocal and harmonious transaction market at this time, the overall happiness of the REITs trading market is the highest, and the success rate of trading increases and the capital circulation of the real estate market is accelerated. Therefore, it is recommended that issuers choose reciprocal competitive decisions when pricing REITs in order to increase the success rate of their own REIT holdings; and it is recommended that the government, when regulating the pricing of REITs, pays attention to the psychological factors of reciprocal preferences of issuers and investors and that the government penalizes REIT issuers and investors when they choose self-serving decisions and rewards them when they choose reciprocal decisions.

Keywords:

real estate investment trusts (REITs), behavioral economics, evolutionary game theory, reciprocity preference, issue pricing

Tan,T. (2023). Analysis of the Game Behavior of Real Estate Mortgage Securities Issuers Based on Reciprocal Preferences. Advances in Economics, Management and Political Sciences,30,135-143.
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References

[1]. Xuemeng, G., Jiaxin, M.: REITs Deal Structure, Valuation and Performance: A Review of the Literature. Communication of Finance and Accounting (06), 24–29+28 (2023).

[2]. Kevin, C.H.C., Ming-Long, L.: REITs in the decentralized investment industry. Journal of Property Investment & Finance 20(6), (2002).

[3]. Yu, Z.: Study on the influencing factors of REITs pricing. Journal of Guizhou Commercial College 22(04), 39–40 (2009).

[4]. Kenneth, Y., Nadia, N.: Investor attention and the expected returns of reits. International Review of Economics and Finance, 48 (2017).

[5]. Yener, C., A. Sevtap, SK., Bilgi, Y.: Diversification Benefit and Return Performance of REITs Using CAPM and Fama-French:Evidence from Turkey. Borsa Istanbul Review 27(4), 199–215 (2017).

[6]. Dominik, R., Ryan, R., Nico, R., Joachim, Z.: effects of uncertainty on market liquidity: Evidence from Hurricane Sandy. Journal of Financial Economics 134(2), (2019).

[7]. Martin, H., Elion, J., André, B.: Monte Carlo simulations for real estate valuation. Journal of Property Investment & Finance 24(2), (2006).

[8]. Weidong, M., Yongping, W.: A study of evolutionary game and multiple equilibria in the trading behavior of Chinese securities investors. Journal of Industrial Engineering and Engineering Management (04), 73-76+88, (2006).

[9]. Hua, L., Yuguang, F.,: Evolutionary game analysis of securities investors' trading behavior. Journal of Systems & Management 19(05), 534–540 (2010).

[10]. Jun, W., Yuqian W., Jihua, H.: Game analysis of the dynamic evolution of the "herding effect" of fund managers in the Chinese securities market. Finance&Economics of Xinjiang (04), 11–20 (2018).

[11]. Bing, S., Jie, Z.: Game Analysis of the Regulation of Insider Information Manipulation in China's Securities Market. Research On Financial and Economic Issues (09), 54–60 (2017).

[12]. John, M S., George,R P.: The Logic of Animal Conflict. Nature, 246 (1973).

[13]. Peter, D T., Leo, B J.: Evolutionary stable strategies and game dynamics. Mathematical Biosciences 40(1-2), (1978).

[14]. John, M S.: Evolution and the theory of games. American scientist 64(1), (1976).

[15]. Weber, M.: Economic Ethics of World Religions: Confucianism and Taoism. 2nd edn. Central Compilation & Translation Press, Building 3, Central Compilation Bureau, No.36 Xixie Street, Xicheng District, Beijing (2018).

[16]. Jingchuan, S.: China's regional economic development:a case study of Wenzhou. Zhejiang University press, Xixi Campus of Zhejiang University, Tianmushan Road (2020).

[17]. Mingquan, L., Zhong, X., Jiantuo, Y.: ROSCA Research Overview. Journal of Financial Research (02), 120–132 (2003).

Cite this article

Tan,T. (2023). Analysis of the Game Behavior of Real Estate Mortgage Securities Issuers Based on Reciprocal Preferences. Advances in Economics, Management and Political Sciences,30,135-143.

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About volume

Volume title: Proceedings of the 7th International Conference on Economic Management and Green Development

ISBN：978-1-83558-081-3(Print) / 978-1-83558-082-0(Online)
Editor：Canh Thien Dang
Conference website: https://www.icemgd.org/
Conference date: 6 August 2023
Series: Advances in Economics, Management and Political Sciences
Volume number: Vol.30
ISSN：2754-1169(Print) / 2754-1177(Online)

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References

[1]. Xuemeng, G., Jiaxin, M.: REITs Deal Structure, Valuation and Performance: A Review of the Literature. Communication of Finance and Accounting (06), 24–29+28 (2023).

[2]. Kevin, C.H.C., Ming-Long, L.: REITs in the decentralized investment industry. Journal of Property Investment & Finance 20(6), (2002).

[3]. Yu, Z.: Study on the influencing factors of REITs pricing. Journal of Guizhou Commercial College 22(04), 39–40 (2009).

[4]. Kenneth, Y., Nadia, N.: Investor attention and the expected returns of reits. International Review of Economics and Finance, 48 (2017).

[5]. Yener, C., A. Sevtap, SK., Bilgi, Y.: Diversification Benefit and Return Performance of REITs Using CAPM and Fama-French:Evidence from Turkey. Borsa Istanbul Review 27(4), 199–215 (2017).

[6]. Dominik, R., Ryan, R., Nico, R., Joachim, Z.: effects of uncertainty on market liquidity: Evidence from Hurricane Sandy. Journal of Financial Economics 134(2), (2019).

[7]. Martin, H., Elion, J., André, B.: Monte Carlo simulations for real estate valuation. Journal of Property Investment & Finance 24(2), (2006).

[8]. Weidong, M., Yongping, W.: A study of evolutionary game and multiple equilibria in the trading behavior of Chinese securities investors. Journal of Industrial Engineering and Engineering Management (04), 73-76+88, (2006).

[9]. Hua, L., Yuguang, F.,: Evolutionary game analysis of securities investors' trading behavior. Journal of Systems & Management 19(05), 534–540 (2010).

[10]. Jun, W., Yuqian W., Jihua, H.: Game analysis of the dynamic evolution of the "herding effect" of fund managers in the Chinese securities market. Finance&Economics of Xinjiang (04), 11–20 (2018).

[11]. Bing, S., Jie, Z.: Game Analysis of the Regulation of Insider Information Manipulation in China's Securities Market. Research On Financial and Economic Issues (09), 54–60 (2017).

[12]. John, M S., George,R P.: The Logic of Animal Conflict. Nature, 246 (1973).

[13]. Peter, D T., Leo, B J.: Evolutionary stable strategies and game dynamics. Mathematical Biosciences 40(1-2), (1978).

[14]. John, M S.: Evolution and the theory of games. American scientist 64(1), (1976).

[15]. Weber, M.: Economic Ethics of World Religions: Confucianism and Taoism. 2nd edn. Central Compilation & Translation Press, Building 3, Central Compilation Bureau, No.36 Xixie Street, Xicheng District, Beijing (2018).

[16]. Jingchuan, S.: China's regional economic development:a case study of Wenzhou. Zhejiang University press, Xixi Campus of Zhejiang University, Tianmushan Road (2020).

[17]. Mingquan, L., Zhong, X., Jiantuo, Y.: ROSCA Research Overview. Journal of Financial Research (02), 120–132 (2003).

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