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Determinants of household’s housing condition in Urban China: A study based on NBS panel data

Dai Erbiao

No 2020-09, AGI Working Paper Series from Asian Growth Research Institute

Abstract: With rapid economic growth and dramatic progress in the market–oriented reform on housing systems since the 1ate 1980s, the housing conditions in urban China have improved significantly. On the other hand, it is widely believed that the introduction of market mechanisms has led to the rise of housing inequality among urban households.Based on panel data of the NBS survey (2004-2007), this paper measures housing inequality among urban households in 162 cities, and examines the determinants of individual household’s housing conditions in China. We find that in the period investigated, there exists a rising trend in housing inequality among urban households.However, the rise of inequality is not simply the result of the market–oriented reform.Our panel analysis demonstrates that although the income factors such as “Household Total Income” have dominant effects on the probability of owning a market-price (i.e., high price) house, the probability of owning a low-price house or renting a public house provided by the government is still significantly affected by some non-income factors, including the employment sectors of household members, and their Hukou (registered residence status). As a whole, both income/market and non-income/institution factors have effects on the probability of having a resident-owned house as well as on the house size. More interestingly, compared to Peking and Shanghai, the two most developed cities in China, the household housing conditions of the rest 160 cities included in the survey receive stronger influence from the old housing allocation system and Hukou system. It means that in the mid-2000s the rising housing inequality in urban China should be the result of a combined influence from ongoing market–oriented reforms and the persisting impact of some traditional systems.

Keywords: Housing condition; inequality; urban China; determinants; panel data; D6; R31 (search for similar items in EconPapers)
Date: 2020-04
New Economics Papers: this item is included in nep-tra and nep-ure
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