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Evaluation of the Supply-Side Efficiency of China’s Real Estate Market: A Data Envelopment Analysis

Author

Listed:
  • Kai Li

    (School of Construction Management and Real Estate, Chongqing University, Chongqing 400045, China)

  • Zhili Ma

    (School of Construction Management and Real Estate, Chongqing University, Chongqing 400045, China)

  • Guozhou Zhang

    (School of Construction Management and Real Estate, Chongqing University, Chongqing 400045, China)

Abstract

With the gradual slowdown of economic growth in China, the Chinese government proposed the task of supply-side reform. As a vital part of China’s economy, supply-side reform in the real estate market is particularly important. Using 29 provinces (divided into seven regions) in China as examples, this paper empirically studies the supply-side efficiency of China’s real estate market using data envelopment analysis (DEA) for the period of 2012–2016. The results showed that (1) the main problem of low supply-side efficiency in the Chinese real estate market is the low land-use efficiency, with a redundancy rate of 60.59% in China’s land space pending development; and (2) China’s southeastern coastal region, with the highest supply-side efficiency in the real estate market, reached a level of decreasing returns, and it is no longer appropriate to increase the supply-side efficiency by expanding the market scale. However, the southwestern region and the Yangtze River’s middle region, which both have lower supply-side efficiency, can improve the land utilization ratio and technology investment to change the current situations. The study results suggest (1) improving the construction land development efficiency by adjusting the input and output of the market according to the specific conditions of each city, and (2) promoting the supply-side reform of China’s real estate market and sustainable urbanization.

Suggested Citation

  • Kai Li & Zhili Ma & Guozhou Zhang, 2019. "Evaluation of the Supply-Side Efficiency of China’s Real Estate Market: A Data Envelopment Analysis," Sustainability, MDPI, vol. 11(1), pages 1-18, January.
    • Handle: RePEc:gam:jsusta:v:11:y:2019:i:1:p:288-:d:195773
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    Cited by:

    1. Weiping Jiang & Lirong Luo & Zezhou Wu & Jianbo Fei & Maxwell Fordjour Antwi-Afari & Tao Yu, 2019. "An Investigation of the Effectiveness of Prefabrication Incentive Policies in China," Sustainability, MDPI, vol. 11(19), pages 1-24, September.
    2. Kai Li & Zhili Ma & Jinjin Liu, 2019. "A New Trend in the Space–Time Distribution of Cultivated Land Occupation for Construction in China and the Impact of Population Urbanization," Sustainability, MDPI, vol. 11(18), pages 1-23, September.
    3. Hirofumi Fukuyama & Yong Tan, 2023. "Estimating market power under a nonparametric analysis: evidence from the Chinese real estate sector," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 45(2), pages 599-622, June.
    4. Han, Yang & Zhang, Haotian & Zhao, Yong, 2021. "Structural evolution of real estate industry in China: 2002-2017," Structural Change and Economic Dynamics, Elsevier, vol. 57(C), pages 45-56.

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