How Much Are Amenities Worth? An Empirical Study on Urban Land and Housing Price Differentials across Chinese Cities

Yan Song, Jiang Zhou, Yingjie Zhang, Dingxin Wu and Honghai Xu
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Yan Song: School of Transportation Engineering, Huaiyin Institute of Technology, Huaian 223003, China
Jiang Zhou: Sichuan Academy of Social Science, Chengdu 610071, China
Yingjie Zhang: School of Economics and Management, Beijing Forestry University, Beijing 100083, China
Dingxin Wu: School of Transportation Engineering, Huaiyin Institute of Technology, Huaian 223003, China
Honghai Xu: School of Economics, Xihua University, Chengdu 610039, China

Land, 2022, vol. 11, issue 6, 1-16

Abstract: As China is transitioning from a planned economy to a market-based economy, over the past 30 years, China’s economy has experienced the same type of changes that led to amenity-driven housing and land markets in more developed countries. This paper examines the effect of different types of amenities on urban land and housing prices across Chinese cities in 2020. When firms and households value some amenities, the assumption is that the preference for these amenities will be valued and reflected in both land and housing markets. We conduct a cross-sectional analysis of urban land and housing prices in prefecture and higher-level cities in China. We extend the Roback model to explore the extent to which the different land rents and housing prices reflect the compensations for interregional amenity differences across Chinese cities. We include two types of amenities: natural amenities and locally produced amenities. We perform two-stage least squares (2SLS) estimations and compute the implicit prices of various amenities for households and firms. The empirical results show that a range of amenities is valued by both households and firms, resulting in higher housing and industrial prices.

Keywords: amenities; industrial land; commodity housing; Chinese cities (search for similar items in EconPapers)
JEL-codes: Q15 Q2 Q24 Q28 Q5 R14 R52 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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