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House price co-movement and labor migration: Evidence from China

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  • Zhou, Zhengyi

Abstract

This paper investigates the effect of house price co-movement on inter-city labor migration, leveraging China's unique institutional background. We construct a shift-share instrumental variable (IV) for house price co-movement, using pairwise banking integration as a source of exogenous variation. We find that at household level, house price co-movement facilitates inter-city labor migration, particularly for migrants with a stronger incentive to hedge against housing consumption risk. At city-pair level, house price co-movement also positively affects migration flows. Hence, as housing market interventions become increasingly city-specific, policymakers should take measures to prevent the deterrence of labor mobility.

Suggested Citation

  • Zhou, Zhengyi, 2025. "House price co-movement and labor migration: Evidence from China," Emerging Markets Review, Elsevier, vol. 69(C).
    • Handle: RePEc:eee:ememar:v:69:y:2025:i:c:s1566014125001141
    DOI: 10.1016/j.ememar.2025.101365
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    Keywords

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    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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