Research of the influence of automobile purchase restriction policy on the pricing of motor vehicles in judicial appraisal enterprises
Authors: Wang Xuying , Lin Jiabao 
Published: November 2022

Purpose
The purpose of this paper is to take second-hand vehicles at judicial auctions in China as the primary research direction and to explore the impact of purchasing restriction policy and city size on the relationship between the appraisal price and transaction price of second-hand motor vehicles in the context of auto purchase restriction in China from a microscopic angle. It attempts to broaden the pricing ideas of judicial appraisal enterprises in providing appraisal prices of second-hand motor vehicles and to put forward suggestions for the optimization of appraisal prices and appraisal standards of judicial appraisal enterprises.

Design/methodology/approach
With the help of Python, this paper crawls 59,038 lines of valid data from three leading internet judicial auction platforms, namely “Ali Auction,” “China Beijing Equity Exchange” and “Gong Pai Wang,” as research samples. Besides, this paper forms a database containing judicial auction used car appraisal prices, transaction prices, motor vehicle purchase restrictions and whether the motor vehicle carries a license plate. By constructing a multiple regression model, the impact of automobile purchase restriction policy on the price of motor vehicles appraised by judicial appraisal enterprises is investigated.

Findings
With the help of the multivariate regression model, it found that under the same condition, the city where the auction took place implemented the automobile purchase restriction before the end of the auction. The court has specified that the buyer could directly obtain the license plate after the auction. The transaction price and the evaluation price ratio will be statistically larger, which proves that the license plate has an evident value in the transaction and is traded as subject matter by the residents, and consequently brings a higher premium to the price of automobile transaction in internet judicial auction. Meanwhile, the purchase restriction policy in the first-tier cities has resulted in a significant premium on automobile license plates, which is much higher than the automobile license plate premium level in non-first-tier cities under the same conditions.

Social implications
Car ownership continues to rise with rapid economic development worldwide. Control the growth of car ownership, some countries and regions mainly restrict the issuance of motor vehicle license plates, which indirectly leads to vehicle license plate indicators becoming a scarce resource. National laws permit judicial auction as a means for the people's courts to settle creditors' claims in enforcement procedures of civil cases. In the judicial auction process, the People's Court introduces third-party evaluation enterprises to appraise, assess and audit the subject and obtain the appraisal price, which guides the bidding behavior of used car buyers and indirectly affects the transaction price of used cars.

Originality/value
As the only subject capable of assessing the value of used cars at judicial auctions, judicial appraisal enterprises have received widespread attention for their appraisal results. This paper researches this field by screening the factors affecting the ratio of motor vehicle transaction price to the appraised price. It also analyzes how the ratio of motor vehicle transaction price to appraised price is affected by motor vehicle purchase restrictions and the situation with license plates. This paper examines the existence of premiums for motor vehicle transactions with license plates, evaluates the purchase restrictions in cities with motor vehicle purchase restrictions and verifies that the premiums for motor vehicles at judicial auctions are affected by purchase restriction policies as well as the influence of city class. These studies have important implications for judicial appraisal enterprises to establish reasonable appraisal mechanisms and optimize appraisal prices. They also provide new ideas and methods for appraisal enterprises to assess the value of used vehicles at judicial auctions.