The nexus between labor wages and property rents in the Greater China area

Terence Tai Leung Chong, Kenny Chi-Wai Shui and Vivian H. Wong

China Economic Review, 2014, vol. 30, issue C, 180-191

Abstract: Tse and Chan (2003) investigated the relationship between property sales price and the value of commuting time without accounting for the fact that property sales price is subject to the inherent limitation of containing speculative elements. A better measure to use for such a study would be the rent paid by the genuine end-user of the property. This paper examines how equilibrium rents in different locations within Greater China are determined by the time value, or the shadow wage, of an individual. Using the rental information, we provide the first estimated ratio of time values for individuals in Hong Kong, Shanghai and Taipei. Our results show that the shadow wage ratio of the households in Hong Kong, Shanghai and Taipei is about 2.25:1:1.61.

Keywords: Shadow wage; Property rental price; Central business district (search for similar items in EconPapers)
JEL-codes: J31 R30 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (1)

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Working Paper: The Nexus between Labour Wages and Property Rents in the Greater China Area (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:30:y:2014:i:c:p:180-191

DOI: 10.1016/j.chieco.2014.06.010

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