Chen, Jie
Wo king Pape
Housing sys em and u baniza ion in he People's Republic
o China
ADBI Wo king Pape , No. 602
P o ided in Coope a ion wi h:
Asian De elopmen Bank Ins i u e (ADBI), Tokyo
Sugges ed Ci a ion: Chen, Jie (2016) : Housing sys em and u baniza ion in he People's Republic o
China, ADBI Wo king Pape , No. 602, Asian De elopmen Bank Ins i u e (ADBI), Tokyo
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ADBI Wo king Pape Se ies
HOUSING SYSTEM AND
URBANIZATION IN THE
PEOPLE’S REPUBLIC OF CHINA
Jie Chen
No. 602
Oc obe 2016
Asian De elopmen Bank Ins i u e
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Jie Chen is p o esso and assis an dean, Ins i u e o Ad anced Resea ch, Shanghai
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ADBI Wo king Pape 602 J. Chen
Abs ac
This pape examines how ans o ma ions in he housing sys em in he People’s Republic o
China (PRC) in luence he PRC pa e n o u baniza ion. I i s discusses how housing
policies de e mine he supply and demand o housing in u ban PRC and subsequen ly
analyzes how he changes in he mode o housing p o ision ha e a ec ed u al–u ban
mig a ion, in e ci y labo mobili y, he inancing o u ban in as uc u e, and gene al u ban
economic ac i i ies in he PRC. The PRC expe ience o he in e ac ion be ween he housing
sys em and u baniza ion is unique, bu i clea ly indica es ha an e ec i e housing sys em
ha can esponsi ely p o ide adequa e and a o dable housing is c ucial o he success o
inclusi e and equi able u baniza ion.
JEL Classi ica ion: R30, R38
ADBI Wo king Pape 602 J. Chen
Con en s
1. INTRODUCTION ....................................................................................................... 1
2. THE INSTITUTIONS OF THE HOUSING SYSTEM
IN THE PEOPLE’S REPUBLIC OF CHINA ................................................................ 1
2.1 Housing P o ision Sys em: P e-Re o m and Re o m E a ............................... 2
2.2 The Housing P o ision Sys em: Pos -Re o m E a .......................................... 2
2.3 Housing Policy F amewo k ............................................................................ 3
3. PERFORMANCE OF THE HOUSING SECTOR IN THE PEOPLE’S REPUBLIC
OF CHINA ................................................................................................................. 4
3.1 Housing Ma ke .............................................................................................. 4
3.2 Housing S ock ................................................................................................ 5
4. THE INTERACTIONS BETWEEN THE HOUSING SYSTEM AND URBANIZATION . 6
4.1 Housing and U baniza ion: An Analy ical F amewo k ..................................... 6
4.2 Housing Ma ke De elopmen s as D i ing Fo ces o U baniza ion ................. 7
4.3 Housing In es men as a D i ing Fo ce o he U ban Economy...................... 7
4.4 P ope y-Led U ban Rede elopmen .............................................................. 8
4.5 Housing Supply as a Suppo ing Appa a us o U ban Expansion ................... 9
4.6 Housing Capi aliza ion as a Financial Engine o U ban De elopmen ............ 9
4.7 Housing Ma ke De elopmen as a Cons ain o U baniza ion..................... 10
4.8 Housing-Based Social S a i ica ion ............................................................. 10
4.9 The P oblems o Mig an s in Local Housing Ma ke s ................................... 11
5. CONCLUDING REMARKS ...................................................................................... 12
REFERENCES ................................................................................................................... 14

ADBI Wo king Pape 602 J. Chen
1. INTRODUCTION
The ans o ma ions in he u ban housing sys em o he People’s Republic o China
(PRC) o e he las 3 decades a e clea ly he esul o he PRC economic es uc u ing
and he u baniza ion p ocess. The changes in he housing sys em ha e con ibu ed
s ongly o eshaping he mode o u baniza ion.
Fi s , he emo al o housing supply esponsibili y, including housing- ela ed wel a e,
was a c ucial s ep owa d e i alizing he PRC’s s a e-owned en e p ises (SOEs) in he
1980s and 1990s (Wang, Wang, and B amley 2005). Second, he ans o ma ion o
u ban housing om a wel a e good o a commodi y good g ea ly helped d i e a
consump ion boom and economic p ospe i y in u ban PRC (Man 2011). Fu he , an
inc easingly lexible housing ma ke wi h esponsi e supply elas ici y is a key o ce in
p opelling u al–u ban popula ion mobili y as well as in e ci y labo mobili y in he PRC.
In addi ion, local s a e e enue om he sale o esiden ial housing land has played a
c ucial ole in inancing he PRC ci ies’ in as uc u e in es men since he 1998
e o ms (Man 2011). As his pape will show, he g ea housing ma ke boom in he
PRC is no only a consequence bu also a sou ce o he PRC’s g ea leap o wa d in
u baniza ion in he new cen u y. In sho , he changing unc ions o s a e in e en ion in
he PRC housing sec o ha e yielded a - eaching impac s on he mode o
u baniza ion. Howe e , as a esul o o e emphasis on he economic unc ions o he
housing sec o , he PRC pos - e o m u ban housing sys em has ailed o mee gene al
housing needs, especially hose o u al- o-u ban mig an s. The ising housing
a o dabili y c isis in he u ban a eas has cons i u ed a majo h ea o he u u e
sus ainabili y o u baniza ion in he PRC (Chen, Hao, and S ephens 2010).
Agains his backg ound, in he las ew yea s, he PRC cen al go e nmen has
p io i ized add essing he housing a o dabili y c isis in he u ban a eas in i s poli ical
agenda (Chen, Yang, and Wang 2014). The main policy ool o achie e his goal is o
supply low-income households wi h discoun ed public housing ha is buil and
alloca ed by local go e nmen s (Shi, Chen, and Wang 2016). Fo example, he Minis y
o Housing and U ban–Ru al De elopmen (MOHURD) ecen ly announced ha mo e
han 36 million uni s o public housing had been cons uc ed du ing he 12 h Fi e-Yea
Plan pe iod (2011–2015) (MOHURD 2016). None heless, whe he he inc eased
emphasis on he public housing p og ams signals a comple e shi o housing policy
ideology in he PRC emains unce ain. Pa icula ly, ques ions ha e been aised abou
how much o he gian p og am has se ed as a social policy ool o add ess ue
a o dabili y p oblems and how much i has been used as an economic policy ool o
o se economic down u n p essu es (Shi, Chen, and Wang 2016). Rega dless, wha is
e iden is ha he PRC has expe ienced con inued d as ic shi s o i s housing sys em
in bo h he p e- e o m and pos - e o m e as. How he e olu ion o he housing sys em
has a ec ed he u baniza ion mode in he PRC has no ye been su icien ly
in es iga ed in he li e a u e.
2. THE INSTITUTIONS OF THE HOUSING SYSTEM
IN THE PEOPLE’S REPUBLIC OF CHINA
The PRC u ban housing sys em can be di ided in o ou p incipal pe iods (Chen and
Han 2014): (i) he de elopmen o he socialis s a e wel a e sys em om he
la e 1940s un il 1978; (ii) he dual- ack sys em un il 1998, which included he mass
p i a iza ion o s a e-owned and o he o ms o public housing du ing he e o ms o he
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ADBI Wo king Pape 602 J. Chen
1980s and 1990s; (iii) he ma ke -domina ed sys em be ween 1999 and 2006, which
included he ull- ledged de elopmen o he housing ma ke and he ma ginaliza ion o
s a e p o ision; and inally (i ) he ongoing new dual egime, seeking o ebalance he
s a e’s and he ma ke ’s oles in he p o ision o u ban housing. This s age is mos ly
e idenced by he mass 36-million-uni public housing p og am implemen ed be ween
2011 and 2015. Al hough i is clea ha he la es changes in he PRC’s housing
sys em ha e been ini ia ed by he slogan o “e e yone should be housed” (zhu you suo
ju) adop ed a he Communis Pa y’s 17 h Na ional Cong ess in 2007, i is also widely
belie ed ha he new u baniza ion s a egy ha o mally launched in 2013 is ano he
key ac o o d i e hese changes (Wo ld Bank and DRC 2013).
2.1 Housing P o ision Sys em: P e-Re o m and Re o m E a
The Maois u ban housing sys em should be unde s ood agains o he de elopmen
s a egy o “indus ializa ion wi hou u baniza ion” in he Maois e a (Zhang 2000). The
labo cos o u ban wo ke s was expec ed by he planning leade s o be much lowe
when he housing was p o ided unde he s a e p o ision sys em han he ma ke
p o ision sys em (Wu 1996). Unde he wo k-uni -based quasi-clan sys em, he
popula ion mobili y ac oss egions was also se e ely cons ained by he in eg a ion o
wo k and li e. Thus, many impo an pa s o social o ganiza ion and labo p oduc ion in
Maois u ban PRC we e buil on he wo k-uni -based public housing p o ision sys em
(Wu 1996).
The hea y dependence o housing cons uc ion on he s a e budge and cen alized
planning led o de e io a ing housing condi ions in Maois u ban PRC (Man 2011). The
a e age loo space pe capi a in p e- e o m u ban PRC sh ank be ween 1952 and
1978, d opping om 4.5 squa e me e s (m2) o 3.6 m2 (Wo ld Bank 1992). The se e e
sho age o housing space hea ily cons ained he expansion o he u ban popula ion in
Maois u ban PRC. F om 1949 o 1978, he u baniza ion a e achie ed only ma ginal
g ow h, om 10.64% o 17.92%.
Housing e o ms in he PRC ha e h ee key componen s: li ing he en o he
main enance le el, selling wo k-uni -owned public en al housing s ock o hei si ing
enan s, and allowing housing o be eely aded on he ma ke . Essen ially, he
concep o u ban housing has been con e ed om a “wel a e good” o a “ma ke
good” (Wu 1996). Fo many easons, he e o m o he u ban housing sys em did no
achie e signi ican p og ess un il he mid-1990s, bu hen he S a e Council, a he
unexpec edly, e mina ed he wel a e housing sys em in July 1998. Many esea che s
a ibu e his d as ic change o he PRC go e nmen ’s wish o s imula e housing
consump ion and o use de elopmen o he housing indus y as a key s a egy o o se
he economic down u n p essu es o he 1997 Asian inancial c isis (Man 2011).
Wi h employe s no longe bound o p o ide housing o u ban wo ke s, he d as ic
es uc u ing o he u ban housing p o ision sys em g ea ly acili a ed u al–u ban
mig a ion as well as in e ci y labo mobili y.
2.2 The Housing P o ision Sys em: Pos -Re o m E a
Since he 1998 housing e o m, he u ban housing sys em in he PRC has e ol ed in
pace wi h he p og ess o economic de elopmen and he u baniza ion p ocess. While
a ma ke sys em o housing p o ision has been g adually e ol ing in his pe iod, a
wo- ie public housing sys em was quickly o med in he i s ew yea s o he ea ly
21s cen u y.
2
ADBI Wo king Pape 602 J. Chen
The pos - e o m public housing sys em consis s o wo componen s: one is cheap
en al housing, a small scheme ha equi es local go e nmen s o p o ide low-
s anda d en al housing a a cheap p ice o mee he basic housing needs o he
lowes -income u ban households; he o he is economic com o able housing (ECH), a
la ge p og am ha equi es local go e nmen s o supply housing o sale a hea ily
discoun ed p ice wi h an aim o boos homeowne ship among low-income u ban
households. To make p ices a o dable, he ECH scheme equi es ee land supply
om local go e nmen s and capped p o i o de elope s (Chen, Yang, and Wang
2014). In he landma k documen o he 1998 housing e o m (SC[1998] No. 23), he
cen al go e nmen clea ly s a ed ha ha ECH would be he majo o m o p o iding
housing, o accommoda e wo- hi ds o u ban esiden s in he pos - e o m e a.
Howe e , as ECH equi es ee land supply and implies signi ican land e enue loss
o local go e nmen s, he cons uc ion plan o ECH was esis ed by local go e nmen s
e e ywhe e and ne e implemen ed in ull o ce. In 2003, in ano he landma k
documen o housing sys em de elopmen (SC[2003]No.18), he S a e Council o mally
downg aded ECH o play a esidual ole in he pos - e o m housing sys em. Since hen,
he p opo ion o ECH in he housing p o ision s uc u e o u ban PRC has d opped o
a ma ginal sha e (Shi, Chen, and Wang 2016).
The ma ke -o ien ed e o m o he housing p o ision sys em pa es he way o mo e
eedom o labo mobili y and u al- o-u ban mig a ion. I also spu ed a housing
ma ke boom ha has con inued un il now. Howe e , housing p ices ha e soa ed in all
majo ci ies since 2004, making home pu chase a o dabili y an acu e issue o
he na ion’s young gene a ion (Chen, Hao, and S ephens 2010). The in low o mig an s
has been se e ely cons ained by he sho age o a o dable housing in he ci ies.
Meanwhile, he pola izing weal h ac oss di e en classes due o di e en chances o
accumula ing asse s h ough he housing ma ke also posi s ano he se ious challenge
o social s abili y.
Unde he g owing p essu es o u ban housing a o dabili y, he PRC S a e Council
published Opinions on Tackling Housing Di icul ies o Low-Income Families in U ban
A eas in Augus 2007 (SC[2007]No.24), which ma ked a undamen al change o
housing policy in he pos - e o m u ban PRC. The cons uc ion o public housing has
been signi ican ly expanded since hen, and add essing he housing a o dabili y c isis
in he u ban a eas has o mally became a signi ican poli ical ask. In ea ly 2011, he
36-million-uni public housing cons uc ion plan o 2011–2015 was o icially announced
by he S a e Council. In he las ew yea s, PRC leade s ha e epea edly emphasized
ha he s a e p o ision o housing should be he key solu ion o mee ing he basic
housing needs o u ban esiden s (Li 2011; Xi 2013).
2.3 Housing Policy F amewo k
Cu en ly, he cen al go e nmen ’s Minis y o Housing and U ban–Ru al De elopmen
(MOHURD) leads in designing and implemen ing he housing policy, wi h
esponsibili ies anging om housing ma ke egula ion o public housing de elopmen .
None heless, he land policy is unde he con ol o he Minis y o Land and
Resou ces, and he cen al bank— he People’s Bank o [ he People’s Republic o ]
China— egula es all policies ega ding housing inance. Unde he s a egic guidelines
o ele an depa men s o he cen al au ho i y, local housing bu eaus p o ide public
housing and egula e he local housing ma ke . This is a hie a chical op-down policy
amewo k ha is consis en wi h he gene al cha ac e is ics o he PRC’s cen alized
bu eauc a ic sys em.
3
ADBI Wo king Pape 602 J. Chen
The cen al go e nmen plays a pi o al ole in he new housing policy amewo k, no
only designing he policy aim and policy guidelines bu some imes e en se ing exac
annual ou pu a ge s o public housing p o ision o each p o ince (MOHURD 2011).
Du ing he pe iod o he 12 h Fi e-Yea Plan (2011–2015), MOHURD ou inely checked
he p og ess o public housing p o ision in ci ies by sending ield in es iga o s, and
also egula ly published he na ional p og ess o new cons uc ions in public housing
on i s o icial websi e (MOHURD 2016). Du ing his pe iod, MOHURD also equen ly
h ea ened o punish local leade s who ailed o mee he public housing ou pu a ge s
assigned by MOHURD h ough public censu e, educed unding, o e en demo ion
(SCGO[2010] No. 4; SOGO[2011] No. 45).
3. THE PERFORMANCE OF THE HOUSING SECTOR
IN THE PEOPLE’S REPUBLIC OF CHINA
Since he ma ke become he p edominan sou ce o u ban housing p o ision in 1998,
he PRC has expe ienced one o he la ges cons uc ion booms in human his o y.
Housing de elopmen has also become mo e closely bound o economic g ow h and
he u baniza ion p ocess.
3.1 Housing Ma ke
Ob iously, economic p ospe i y and apid u baniza ion a e majo o ces o d i e he
ecen housing ma ke boom in he PRC (Chen and Han 2014).The s ong upwa d
end o housing p ices in u ban PRC has gene ally been main ained since 1999, wi h
only a ew b ie in e up ions in 2009 and 2014. The na ional a e age commodi y
housing p ice in u ban PRC ose om CNY1,854 pe m2 in 1998 o CNY6,472 pe m2
in 2015, oughly 250% g ow h wi hin 18 yea s (NBSC 2016). I should be no ed ha
he g ow h o housing p ices was much as e in la ge ci ies in he PRC (Yang and
Chen 2014).
Despi e he ac ha he PRC has expe ienced a con inued economic boom o e he
same pe iod, i has been ound ha he g ow h o household income could no ully
explain he su ge in housing p ices in he ci ies, especially in he big ci ies (Chen and
Han 2014). The e a e signi ican a ia ions o housing a o dabili y issues ac oss
egions and hose a eas wi h as e u baniza ion and la ge in lows o mig an s end o
ha e mo e acu e housing a o dabili y p essu es. A ecen empi ical wo k inds ha
e e y 10% inc ease in he sha e o mig an s in he local popula ion g ow h in a ci y
be ween 2000 and 2005 led o a 16.17% inc ease in housing p ices in he ci y in 2005
(Lu, Chen, and Wu 2014). Howe e , he s udy also inds ha he con ibu ion o
mig an s o housing p ice g ow h is p ima ily d i en by high-income u ban- o-u ban
mig an s a he han low-income u al- o-u ban mig an s (Lu, Chen, and Wu 2014).
4
ADBI Wo king Pape 602 J. Chen
canno a o d o pu chase a all, so housing pe pe ua es inequali y (Li 2012). The hi d
di ide is be ween he pe manen and mig an popula ion, whose housing op ions a e
qui e di e en .
Meanwhile, egional inequali y in housing is a salien ea u e o housing de elopmen
in he pos - e o m PRC. A he household le el, he inequali y o housing in u ban
PRC has con inued o ise since he ma ke iza ion o housing p o ision. A ecen
empi ical in es iga ion shows ha he Gini coe icien o housing space pe pe son in
Shanghai was mo e han 0.5 in 2010, signi ican ly highe han ha in 2000 (Zhang and
Chen 2014).
4.9 P oblems o Mig an s in Local Housing Ma ke s
Al hough he u baniza ion p ocess in he PRC has g own apidly in he las 2 decades,
he mobili y o mig an s is s ill hea ily cons ained by many ins i u ional ba ie s. The
mos -ci ed ins i u ional ba ie o mig a ion is he hukou sys em, which was in oduced
in 1958 and emains in o ce (Lu and Wan 2014). The hukou sys em is essen ially an
in eg a ion o he u ban egis a ion sys em and he local wel a e sys em, whe e only
esiden s who ha e ob ained local hukou can access he local wel a e sys em including
pension, heal h ca e, housing bene i s, elemen a y educa ion, and o he public
se ices. As mig an s a e pa ly o comple ely excluded om he local wel a e sys em,
unde he hukou sys em hei mobili y is se e ely cons ained. In many si ua ions,
young mig an s ha e o wo k alone in he ci ies, lea ing hei amily membe s and
pa icula ly school-age child en in he home owns (PFPC 2012). The hukou sys em has
also been cons an ly no ed as a majo cons ain in he housing consump ion o
mig an s. A ecen in es iga ion based on 2010 census da a e eals subs an ial
dispa i ies in housing condi ions ac oss esiden s wi h di e en hukou s a uses in
Shanghai; o example, he mean housing space pe pe son was 29.44 m2 among
Shanghai na i es in 2010, bu only 14.68 m2 o mig an s (Zhang and Chen 2015). The
gap is s ill subs an ial e en a e adjus ing o di e ences in human capi al (Zhang and
Chen 2015). Acco ding o an o icial na ional su ey, in 2010 only 10% o mig an s
owned homes in he hos ci ies (PFPC 2012). The PRC mig an s’ housing p oblem was
deepening a he han alle ia ing in he ea ly 21s cen u y (Zhang and Chen 2014).
Se e al mic o s udies show ha mig an s in majo ci ies a e no spa ially well in eg a ed
wi h local esiden s (Chen and Hao 2014). They gene ally li e ou side he expensi e
down own a ea and clus e hea ily in he cheape subu ban a eas, which o e
low-skilled job oppo uni ies and in o mal housing accommoda ion solu ions. Fo
example, in 2010, he dissimila i y index be ween mig an s and local esiden s in
Shanghai was measu ed o be be ween 0.3373 and 0.4562, depending on he scale o
he communi y (Chen and Hao 2014). These measu emen s a e much highe han
wha was ound o he same ci y in 2000 (Li and Wu 2008), indica ing a la ge g ow h in
esiden ial seg ega ion in Shanghai since he ma ke -o ien ed de elopmen o housing
p o ision. The ise o hukou-based esiden ial seg ega ion is no only due o a
sel -so ing ma ke equilib ium bu is also a esul o disc imina ing ins i u ional o ces
because he mig an s a e cons ained in hei housing choices unde he hukou sys em
(Chen and Hao 2014). This is a s ong indica o ha he PRC mode o u baniza ion is
nei he p o-poo no inclusi e.
11

ADBI Wo king Pape 602 J. Chen
5. CONCLUDING REMARKS
O e he las 2 decades, he PRC u ban housing sys em has shi ed apidly om a
s a e-domina ed sys em o one in which ma ke -like mechanisms a e playing g owing
oles in he p oduc ion and consump ion o u ban housing. The PRC's ma ke -o ien ed
e o ms o housing p o ision also spu ed he d as ic ans o ma ions o he local
spa ial landscapes in he ci ies (Man 2011). In pa icula , wi h u ban esiden s’
inc eased access o housing om he ma ke a he han om wo k uni s, hei labo
mobili y pa e ns, job–housing links, and anspo modes and commu ing beha io
ha e all g ea ly changed (Chen and Han 2014). F om his pe spec i e, he
ans o ma ion o he housing sys em is key o unde s anding he u baniza ion p ocess.
Howe e , al hough he housing ma ke boom helps o boos economic p ospe i y in he
u ban PRC, he soa ing u ban commodi y housing p ices a e making decen homes in
he ci ies inc easing una o dable o he new gene a ion, especially o young mig an
wo ke s (Shi, Chen, and Wang 2016). The g owing housing a o dabili y c isis has
become a se ious h ea o he u u e p ospec s o u baniza ion in he PRC (Yang and
Chen 2014). The mobili y o u al- o-u ban mig an s has been hea ily cons ained
by he lack o a o dable housing in he ci ies, hus leading o insu icien agglome a ion
o big ci ies in he u ban PRC (Lu and Wan 2014). Meanwhile, he apidly g owing
middle class is a key d i ing o ce o he economic de elopmen and socioeconomic
ansi ions in he PRC o e he las 2 decades (ADB 2010). A signi ican po ion o he
PRC eme ging middle class in he u ban a eas consis s o he young educa ed g oups
ha a e lowing in o la ge ci ies om small ci ies. This g oup has been playing ac i e
oles in bo h economic p oduc ion and social li e in he u ban PRC. The PRC s a e has
ound i poli ically impo an o add ess he p essing need o mee he housing needs o
he new middle class (Li 2011; Xi 2013).
Thus, since 2008, by launching a se ies o massi e cons uc ion plans o public
housing, he PRC s a e has again easse ed i s ole in he p o ision o u ban housing
and clea ly in ends o do so in ways ha will shape he whole housing sys em o
decades o come. Howe e , he e is no e idence ha he new massi e public housing
p og am ep esen s a e e sion o he ype o s a e socialis sys em ha ope a ed
be o e 1998 (Chen, S ephens, and Man 2014). The 2011–2015 mass public housing
p og am should be in e p e ed as a key componen o he new u baniza ion s a egy
adop ed by he new PRC leade ship in 2013 (Li 2011). I should also be no ed ha he
new mode o p o iding u ban public housing is hea ily in luenced by he poli ical, iscal,
inancial, and land owne ship s uc u e (Naugh on 2010; Wang e al. 2012) in he PRC.
The changing guiding ideology o he PRC poli ical go e nance is he s a ing poin o a
be e unde s anding o he complex ma ke –s a e ela ionship in he PRC pos - e o m
u ban housing sys em (Chen, Yang, and Wang 2014). Unde he g owing dominance
o he ma ke in he economic ansi ion, he dilu ion and e osion o he s a e’s powe
is una oidable. None heless, in any ma ke economy, he unc ioning o ma ke
mechanisms in he housing sec o is highly sensi i e o how he s a e add esses he
s eng hs and weakness o he ma ke ins i u ions. Fo example, he pe o mance o he
housing ma ke since 2010 has been la gely in luenced by he cen al go e nmen ’s
policy package o cool he p ope y sec o , including he quo a es ic ion o home
pu chasing and ha sh e ms o mo gage bo owing (Chen and Han 2014). Some
schola s ha e in e p e ed he swi esponses o he PRC’s housing policy o in e nal
and ex e nal economic shocks as e idence o a con ingen ype o neolibe alism (Wang
e al. 2012). None heless, i is e iden ha in he u ban housing sec o , he PRC s a e
has con inued o assume he ole o “builde o he ma ke .”
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ADBI Wo king Pape 602 J. Chen
The PRC s a e’s g ea e eliance on he supply-side app oach o add ess he housing
a o dabili y issue should be unde s ood unde he speci ic poli ical and economic
ins i u ions o land and housing p o ision in he PRC. On one hand, since he ou b eak
o he 2008/2009 global inancial c isis, he PRC go e nmen has expanded o ake
mo e di ec con ol o esou ce alloca ion in key economic sec o s and social a ai s,
which he PRC s a e deems necessa y o assu e i s economic s abili y and poli ical
sa e y (Naugh on 2010). Thus, he PRC s a e no only equen ly in e enes in he
unc ioning o he u ban housing ma ke bu also p e e s o be a dominan playe in he
p o ision sys em o u ban housing. Pa icula ly, he PRC s a e’s ull monopoly o u ban
land makes i a ac i e o local go e nmen o deli e low-cos public housing di ec ly
(Wang and Mu ie 2011). None heless, in p ac ice he local go e nmen s usually wo k
oge he wi h s a e-owned o p i a e de elope s in supplying public housing. The
cen al di e ence be ween he new public housing in he pos - e o m e a and he old
public housing in he p e- e o m e a is ha he o me is no longe a ilia ed wi h he
wo k uni and hus i is public wel a e a he han wo k-uni -based wel a e. Howe e ,
whe he he ecen e i al o public housing has eally helped o co ec some nega i e
ex e nali ies and ine iciencies embedded in he PRC’s pos - e o m housing sys em
emains an open ques ion o u u e esea ch.
In summa y, he PRC has a unique expe ience ega ding he in e ac ion be ween he
e olu ion o i s housing sys em and i s u baniza ion mode bu he e a e gene al lessons
ha we can d aw om his expe ience. Fi s , i clea ly shows ha he su icien supply
o a o dable housing in he ci ies is cen al o he success o u baniza ion. Fu he , i is
challenging o balance di e en policy a ge s es ing on he housing policy, and he
s a e mus ully unde s and he ade-o s behind di e en policy op ions. Thi d, o
gua an ee housing a o dabili y, access o a o dable housing should be p o ec ed no
only by go e nmen mo emen s bu also by laws. Thus, he UN-hono ed concep o
“housing igh s” in which adequa e housing is conside ed a basic human igh should
be p omo ed uni e sally (UN-HCHR 2009). Fou h, an e ec i e and e icien housing
inance sys em is he basic ounda ion o an a o dable housing sys em, especially o
young mig an s.
O e all, in he las 2 decades, he PRC has achie ed some success in adap ing i s
housing sys em mode o suppo i s economic and social de elopmen s a egy.
Howe e , wi h g owing p essu es o e housing a o dabili y and housing bubbles in he
ci ies, he PRC go e nmen aces he big challenge o u he modi ying i s housing
sys em o assu e he sus ainabili y o u baniza ion and o boos inclusi e u baniza ion.
Many u u e in es iga ions a e called o .
13
ADBI Wo king Pape 602 J. Chen
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