The Demand for Space in China

40 Pages Posted: 30 Dec 2013 Last revised: 17 Oct 2015

Date Written: June 2015

Abstract

We review the evolution of housing policy in the People’s Republic of China as the government has, over the past 60 plus years, shifted the provision of housing services from a market system, to a planned system, and back again. Using data from the 1991 to 2006 Chinese Health and Nutrition Surveys, we estimate that, in China’s renewed market phase, the own-price and income elasticities of the demand for habitable space are -.46 and .45, respectively. Absent information on the price of amenities, our data cannot inform us about the role of the price of amenities on the demands for amenities or housing services. However, even absent the price of amenities, our estimates indicate that the permanent income elasticity of housing services demand in China is .72 and the elasticity of housing services demand with respect to the price of space is -.57.

Keywords: Housing, China

JEL Classification: R31, P36, O53

Suggested Citation

Murray, Michael P. and Sun, Guoqing, The Demand for Space in China (June 2015). Available at SSRN: https://ssrn.com/abstract=2372658 or http://dx.doi.org/10.2139/ssrn.2372658

Michael P. Murray (Contact Author)

Bates College ( email )

Lewiston, ME 04240
United States
207-786-6085 (Phone)

Guoqing Sun

Bates College ( email )

Lewiston, ME 04240
United States

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