Spatial inequality and housing in China

Thomas Fischer

Journal of Urban Economics, 2023, vol. 134, issue C

Abstract: This paper investigates the evolution of inequality in China (1978–2015) through the lens of a dynamic spatial general equilibrium model with migration and capital formation. Due to an urban-rural income gap there is domestic migration from the rural to the urban areas which tends to reduce inequality. The resulting increase in urban house prices can, however, constitute an endogenous barrier to further urbanization. Increasing housing prices increase within-urban inequality between renters and landlords and also lock in urban-rural income differences. The calibrated model explains current, and projects future, development in China.

Keywords: China; Inequality; Urban-rural divide; Regional migration; Housing (search for similar items in EconPapers)
JEL-codes: D3 O18 R12 R23 R3 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:juecon:v:134:y:2023:i:c:s0094119023000013

DOI: 10.1016/j.jue.2023.103532

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