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Land and residential property markets in a booming economy: New evidence from Beijing

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Author Info

  • Zheng, Siqi
  • Kahn, Matthew E.

Abstract

Beijing's housing market has boomed over the last fifteen years. The city's population grew by 40.6% and per capita income (in constant RMB) by 273.9% from 1991 to 2005. Using two geocoded data sets, we present new evidence on the real estate price gradient, land price gradient, population densities, and building densities in Beijing's recent free housing market. The classic urban monocentric model's predictions are largely upheld in Beijing. We also document the importance of local public goods, such as access to public transit infrastructure, core high schools, clean air, and major universities, most of which have exogenous locations, as important determinants of real estate prices.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Urban Economics.

Volume (Year): 63 (2008)
Issue (Month): 2 (March)
Pages: 743-757

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Handle: RePEc:eee:juecon:v:63:y:2008:i:2:p:743-757

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Web page: http://www.elsevier.com/locate/inca/622905

Related research

Keywords: Housing market Land market Local public goods Quality of life;

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  1. Patrick Bajari & Matthew E. Kahn, 2002. "Estimating Housing Demand with an Application to Explaining Racial Segregation in Cities," Working Papers 02011, Stanford University, Department of Economics.
  2. Edward L. Glaeser & Matthew E. Kahn, 2001. "Decentralized Employment and the Transformation of the American City," NBER Working Papers 8117, National Bureau of Economic Research, Inc.
  3. Ed Glaeser & Jed Kolko & Albert Saiz, 2000. "Consumer City," NBER Working Papers 7790, National Bureau of Economic Research, Inc.
  4. Kenneth Y. Chay & Michael Greenstone, 1999. "The Impact of Air Pollution on Infant Mortality: Evidence from Geographic Variation in Pollution Shocks Induced by a Recession," NBER Working Papers 7442, National Bureau of Economic Research, Inc.
  5. David Dale-Johnson & Christian L. Redfearn & W. Jan Brzeski, 2005. "From Central Planning to Centrality: Krakow's Land Prices After Poland's Big Bang," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 33(2), pages 269-297, 06.
  6. Gyourko, Joseph & Kahn, Matthew & Tracy, Joseph, 1999. "Quality of life and environmental comparisons," Handbook of Regional and Urban Economics, in: P. C. Cheshire & E. S. Mills (ed.), Handbook of Regional and Urban Economics, edition 1, volume 3, chapter 37, pages 1413-1454 Elsevier.
  7. Chang-Moo Lee & Peter Linneman, 1998. "Dynamics of the Greenbelt Amenity Effect on the Land Market-The Case of Seoul's Greenbelt," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 26(1), pages 107-129.
  8. Zheng, Siqi & Fu, Yuming & Liu, Hongyu, 2006. "Housing-choice hindrances and urban spatial structure: Evidence from matched location and location-preference data in Chinese cities," Journal of Urban Economics, Elsevier, vol. 60(3), pages 535-557, November.
  9. Berger, Mark C. & Blomquist, Glenn C. & Peter, Klara Sabirianova, 2003. "Compensating Differentials in Emerging Labor and Housing Markets: Estimates of Quality of Life in Russian Cities," IZA Discussion Papers 900, Institute for the Study of Labor (IZA).
  10. Gibbons, Stephen & Machin, Stephen, 2005. "Valuing rail access using transport innovations," Journal of Urban Economics, Elsevier, vol. 57(1), pages 148-169, January.
  11. Bertaud, Alain & Renaud, Bertrand, 1997. "Socialist Cities without Land Markets," Journal of Urban Economics, Elsevier, vol. 41(1), pages 137-151, January.
  12. James E. Rauch, 1991. "Productivity Gains From Geographic Concentration of human Capital: Evidence From the Cities," NBER Working Papers 3905, National Bureau of Economic Research, Inc.
  13. Patrick Bajari & C. Lanier Benkard, 2005. "Demand Estimation with Heterogeneous Consumers and Unobserved Product Characteristics: A Hedonic Approach," Journal of Political Economy, University of Chicago Press, vol. 113(6), pages 1239-1276, December.
  14. Kenneth Y. Chay & Michael Greenstone, 2005. "Does Air Quality Matter? Evidence from the Housing Market," Journal of Political Economy, University of Chicago Press, vol. 113(2), pages 376-424, April.
  15. Sherwin Rosen, 2002. "Markets and Diversity," American Economic Review, American Economic Association, vol. 92(1), pages 1-15, March.
  16. Bowes, David R. & Ihlanfeldt, Keith R., 2001. "Identifying the Impacts of Rail Transit Stations on Residential Property Values," Journal of Urban Economics, Elsevier, vol. 50(1), pages 1-25, July.
Full references (including those not matched with items on IDEAS)

Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. China's Future Green Cities
    by Matthew E. Kahn in Environmental and Urban Economics on 2011-12-02 16:10:00
  2. China Goes Green?
    by Matthew E. Kahn in Environmental and Urban Economics on 2011-04-02 02:20:00
  3. The Income Elasticity of Demand for a High Quality Toliet
    by Matthew E. Kahn in Environmental and Urban Economics on 2010-10-02 16:21:00
  4. Designing a High Quality Environmental Economics Course
    by Matthew E. Kahn in Environmental and Urban Economics on 2010-03-10 16:42:00
  5. Chinaâ??s Rising Demand for â??Green Citiesâ?
    by Matthew Kahn in the reality-based community on 2011-04-24 03:07:43
  6. Urbanization and Economic Development
    by Matthew E. Kahn in Environmental and Urban Economics on 2012-06-10 22:13:00
  7. How Should Environmental Economics Be Taught?
    by Matthew Kahn in Environmental and Urban Economics on 2012-07-30 17:56:00
  8. “Green People Power” in China
    by Matthew E. Kahn in The Reality-Based Community on 2012-10-28 22:09:57
  9. My Harvard Business Review Blog Piece on China's Bullet Trains and a History of My Economic Thought About China
    by Matthew Kahn in Environmental and Urban Economics on 2013-04-08 15:50:00
  10. Exploring Green Cities in China
    by Matthew Kahn in Urbanization Project on 2013-04-09 23:17:09
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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Cited by:
  1. Aizenman, Joshua & Jinjarak, Yothin, 2008. "Current account patterns and national real estate markets," Santa Cruz Department of Economics, Working Paper Series qt1rh4s127, Department of Economics, UC Santa Cruz.
  2. Zhang, Ming & Wang, Lanlan, 2013. "The impacts of mass transit on land development in China: The case of Beijing," Research in Transportation Economics, Elsevier, vol. 40(1), pages 124-133.
  3. Wenjie Wu, 2012. "Spatial Variations in Amenity Values: New Evidence from Beijing, China," SERC Discussion Papers 0113, Spatial Economics Research Centre, LSE.
  4. Christian Dreger & Yanqun Zhang, 2010. "Is There a Bubble in the Chinese Housing Market?," Discussion Papers of DIW Berlin 1081, DIW Berlin, German Institute for Economic Research.
  5. Du, Hongyan & Ma, Yongkai & An, Yunbi, 2011. "The impact of land policy on the relation between housing and land prices: Evidence from China," The Quarterly Review of Economics and Finance, Elsevier, vol. 51(1), pages 19-27, February.
  6. Siqi Zheng & Matthew E. Kahn, 2013. "Understanding China's Urban Pollution Dynamics," Journal of Economic Literature, American Economic Association, vol. 51(3), pages 731-72, September.
  7. Siqi Zheng & Matthew E. Kahn, 2013. "Does Government Investment in Local Public Goods Spur Gentrification? Evidence from Beijing," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 41(1), pages 1-28, 03.
  8. Siqi Zheng & Matthew E. Kahn & Hongyu Liu, 2009. "Towards a System of Open Cities in China: Home Prices, FDI Flows and Air Quality in 35 Major Cities," NBER Working Papers 14751, National Bureau of Economic Research, Inc.
  9. Siqi Zheng & Cong Sun & Ye Qi & Matthew E. Kahn, 2013. "The Evolving Geography of China’s Industrial Production: Implications for Pollution Dynamics and Urban Quality of Life," NBER Working Papers 19624, National Bureau of Economic Research, Inc.
  10. Wenjie Wu, 2012. "Does Public Investment Spur the Land Market?: Evidence from Transport Improvement in Beijing," SERC Discussion Papers 0116, Spatial Economics Research Centre, LSE.
  11. Liang Peng & Thomas Thibodeau, 2012. "Government Interference and the Efficiency of the Land Market in China," The Journal of Real Estate Finance and Economics, Springer, vol. 45(4), pages 919-938, November.
  12. Zheng, Siqi & Wu, Jing & Kahn, Matthew E. & Deng, Yongheng, 2012. "The nascent market for “green” real estate in Beijing," European Economic Review, Elsevier, vol. 56(5), pages 974-984.
  13. Dean Hanink & Robert Cromley & Avraham Ebenstein, 2012. "Spatial Variation in the Determinants of House Prices and Apartment Rents in China," The Journal of Real Estate Finance and Economics, Springer, vol. 45(2), pages 347-363, August.
  14. Zheng, Siqi & Peiser, Richard B. & Zhang, Wenzhong, 2009. "The rise of external economies in Beijing: Evidence from intra-urban wage variation," Regional Science and Urban Economics, Elsevier, vol. 39(4), pages 449-459, July.
  15. Feng, Hao & Lu, Ming, 2013. "School quality and housing prices: Empirical evidence from a natural experiment in Shanghai, China," Journal of Housing Economics, Elsevier, vol. 22(4), pages 291-307.

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