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The effect of housing wealth on labor force participation: Evidence from China

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  • Fu, Shihe
  • Liao, Yu
  • Zhang, Junfu

Abstract

This paper uses the 2011 China Household Finance Survey data to estimate the effect of changes in housing value on homeowners’ labor force participation. Using the average housing capital gains of other homes in the same community as an instrument for the housing capital gains of a given household, we find that a 100,000 yuan increase in housing value leads to a 1.37 percentage point decrease in female homeowners’ probability of participating in the labor force and a 1.49 percentage point increase in their probability of becoming housewives. We find little effect on men's labor force participation.

Suggested Citation

  • Fu, Shihe & Liao, Yu & Zhang, Junfu, 2016. "The effect of housing wealth on labor force participation: Evidence from China," Journal of Housing Economics, Elsevier, vol. 33(C), pages 59-69.
  • Handle: RePEc:eee:jhouse:v:33:y:2016:i:c:p:59-69
    DOI: 10.1016/j.jhe.2016.04.003
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    Cited by:

    1. Jianmei Zhao & Lin Liu & Ruihan Liu, 2018. "How house price appreciation affects homeowners' labour force participation : Evidence from urban China," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 26(2), pages 233-252, April.
    2. Salari, Mahmoud & Javid, Roxana J., 2019. "How does female labor force participation impact on housing values?," Research in Economics, Elsevier, vol. 73(2), pages 129-137.
    3. Liu, Lu & Wang, Qiuyun & Zhang, Anquan, 2019. "The impact of housing price on non-housing consumption of the Chinese households: A general equilibrium analysis," The North American Journal of Economics and Finance, Elsevier, vol. 49(C), pages 152-164.
    4. Li, Lixing & Wu, Xiaoyu, 2019. "Housing price and intergenerational co-residence in urban China," Journal of Housing Economics, Elsevier, vol. 45(C), pages 1-1.
    5. Chen, Xi & Ge, Suqin, 2018. "Social norms and female labor force participation in urban China," Journal of Comparative Economics, Elsevier, vol. 46(4), pages 966-987.

    More about this item

    Keywords

    Housing wealth effect; Housing price; Labor supply; Labor force participation;

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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