{"title":"Homeownership and public sector employment: Evidence from the removal of home purchase restrictions in China","authors":"Yaqun Zhu, Jun Kong","doi":"10.1016/j.jhe.2024.102041","DOIUrl":null,"url":null,"abstract":"<div><div>This paper utilizes a quasi-experiment in China that removed home purchase restrictions (HPR) in 2014 to examine the causal effect of homeownership on public sector employment through a difference-in-differences (DID) approach. Combining the 2012, 2014 China Family Panel Studies (CFPS) and the 2011, 2013, 2015 China Household Finance Survey (CHFS), we find that removing the HPR significantly decreases the probability of working in the public sector by 47 %, this negative effect holds for both homeowners and renters. The mechanism analyses show that firstly, removing the HPR increases house prices, which makes homeowners more resistant to possible unemployment shock, and thus reduces the attractiveness of the public sector, which is called as the wealth buffer channel; secondly, the rising house prices discourages renters to work in the public sector, where workers are paid lower wages and struggle to afford a more expensive house in the future, this is the home purchase channel; thirdly, as the HPR in China, is a prevailing <em>Hukou</em><span><span><sup>1</sup></span></span>-based discriminatory policy, the removal of HPR makes local <em>Hukou</em> no longer necessary to qualify for buying a house, and then reduce the propensity of public sector employment, that is the homeownership eligibility channel. In addition, it is found that the impact of removing the HPR is larger for unmarried males who have a higher likelihood of buying a house to improve their competitiveness in the marriage market. Lastly, there are greater negative effects for young workers and employees with children.</div></div>","PeriodicalId":51490,"journal":{"name":"Journal of Housing Economics","volume":"67 ","pages":"Article 102041"},"PeriodicalIF":1.4000,"publicationDate":"2024-12-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Housing Economics","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S1051137724000603","RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q3","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 0
Abstract
This paper utilizes a quasi-experiment in China that removed home purchase restrictions (HPR) in 2014 to examine the causal effect of homeownership on public sector employment through a difference-in-differences (DID) approach. Combining the 2012, 2014 China Family Panel Studies (CFPS) and the 2011, 2013, 2015 China Household Finance Survey (CHFS), we find that removing the HPR significantly decreases the probability of working in the public sector by 47 %, this negative effect holds for both homeowners and renters. The mechanism analyses show that firstly, removing the HPR increases house prices, which makes homeowners more resistant to possible unemployment shock, and thus reduces the attractiveness of the public sector, which is called as the wealth buffer channel; secondly, the rising house prices discourages renters to work in the public sector, where workers are paid lower wages and struggle to afford a more expensive house in the future, this is the home purchase channel; thirdly, as the HPR in China, is a prevailing Hukou1-based discriminatory policy, the removal of HPR makes local Hukou no longer necessary to qualify for buying a house, and then reduce the propensity of public sector employment, that is the homeownership eligibility channel. In addition, it is found that the impact of removing the HPR is larger for unmarried males who have a higher likelihood of buying a house to improve their competitiveness in the marriage market. Lastly, there are greater negative effects for young workers and employees with children.
期刊介绍:
The Journal of Housing Economics provides a focal point for the publication of economic research related to housing and encourages papers that bring to bear careful analytical technique on important housing-related questions. The journal covers the broad spectrum of topics and approaches that constitute housing economics, including analysis of important public policy issues.