Abstract: The existing researches on real estate price regulation mainly focus on extending the reaction function of monetary policy and testing the fiscal theory price level (FTPL), thus ignoring the coordination between monetary policy and fiscal policy. Actually, in view of the aggregate goal of monetary and budget constraint of fiscal, single policy can’t prevent a real estate bubble from bursting, while adopting a package of monetary-fiscal mix is useful to avoid “Minsky Moment”. Therefore, firstly, this paper employs Markov-switching Model to identify the regime-switching of monetary-fiscal mix; secondly, names them “Ricardo System” and “Non-Ricardo System” according to the regime features; then exploits the two features of monetary-fiscal mix rule to perform counterfactual exercises separately. Finally, this paper draws a conclusion that the Non-Ricardo System, in which the monetary-fiscal mix can be appropriately described as a regime of fiscal dominance, is a good way to avoid “Minsky Moment” and induce the fund from virtual to reality.

Key words: Fiscal Policy; Monetary Policy; Real Estate Price; Ricardo System