The Effect of House Prices on Fertility: Evidence from House Purchase Restrictions

45 Pages Posted: 26 Apr 2024 Last revised: 29 Jun 2024

See all articles by Ziqian Liu

Ziqian Liu

Guanghua School of Management, Peking University

Yu Zhang

Peking University - Guanghua School of Management

Date Written: April 15, 2024

Abstract

We assess the causal effect of house price increases on the great birth rate decline in China from 2016 onward, and on the country's marriage market and private educational investments. Quasi-experimental increases in house prices, driven by the capital spillovers of house purchase restrictions in large cities to nearby unregulated cities, significantly reduced the birth rate in these cities. In the microdata, the individuallevel effects were concentrated among rural people who do not own urban homes, especially when rural schools are spatially scarce. Both the marriage and the withinmarriage margins contributed to their fertility effects. Private investments in children's education increased after the house price shock. A back-of-the-envelope calculation suggests that the positive house price shock accounted for a non-negligible share of the aggregate birth decline.

Keywords: house prices, fertility choice, marriage, urbanization, human capital investment JEL Classification: D13, D15, J13, O15, R21, R31

JEL Classification: D13, D15, J13, O15, R21, R31

Suggested Citation

Liu, Ziqian and Zhang, Yu, The Effect of House Prices on Fertility: Evidence from House Purchase Restrictions (April 15, 2024). Available at SSRN: https://ssrn.com/abstract=4808554 or http://dx.doi.org/10.2139/ssrn.4808554

Ziqian Liu

Guanghua School of Management, Peking University ( email )

15222880717 (Phone)

Yu Zhang (Contact Author)

Peking University - Guanghua School of Management ( email )

Peking University
Beijing, Beijing 100871
China

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