Housing affordability, subsidized lending and cross-city variation in the performance of China’s housing provident fund program

Lan Deng, Xiang Yan and Jie Chen

Housing Studies, 2021, vol. 36, issue 4, 455-478

Abstract: This study examines the cross-city variation in the performance of China’s Housing Provident Fund (HPF) program, a collective saving scheme that provides subsidized lending to support participants’ home purchases. It finds that while the program as a whole is limited in both participation and benefit provision, the level of HPF activities has differed across localities. Panel-data analysis of HPF lending in seven cities reveals that local housing affordability was an important determinant of who benefited from the program. Rising housing price increased the demand for HPF loans. But if price rose too high relative to household income, the share of participants who used HPF loans declined. This shows that as the program currently operates, expanding HPF participation would only increase the inequality in the distribution of program benefits. Finally, we did not find evidence for the counter-cyclic effects that HPF lending was expected to have in relation to bank lending. These findings have important implications for the program’s future reform.

Date: 2021
References: Add references at CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://hdl.handle.net/10.1080/02673037.2019.1585521 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:chosxx:v:36:y:2021:i:4:p:455-478

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/chos20

DOI: 10.1080/02673037.2019.1585521

Access Statistics for this article

Housing Studies is currently edited by Chris Leishman, Moira Munro, Ray Forrest, Alex Schwartz, Hal Pawson and John Flint

More articles in Housing Studies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().