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What role does the real estate–construction sector play in China’s regional economy?

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  • Honghao Ren
  • Henk Folmer
  • Arno Vlist

Abstract

Urbanization, industrialization and real estate reform have led to a vast growth of the real estate–construction sector in China. Using the 2002 and 2007 provincial input–output tables, this paper examines the importance of the real estate–construction sector in the Chinese economy by applying the hypothetical extraction method. The results show that for the 30 studied provinces, the weighted average impact of the real estate–construction sector accounts for 21 % of total output and for approximately 14 % of all jobs in 2002. For 2007, these figures are 23 and 22 %, respectively. The impact of the real estate–construction sector on total output and employment varies across regions. In 2007, the direct and indirect output and employment of real estate–construction sector accounted for around 15 % of total regional output and employment in Shandong and Henan, and for 40 % in Tianjin, Jilin, Shaanxi, Ningxia and Xinjiang. Our results also indicate that the real estate–construction sector is strongly own final demand oriented and regional economies which highly rely on it are particularly vulnerable to a fall in its demand. Copyright Springer-Verlag Berlin Heidelberg 2014

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  • Honghao Ren & Henk Folmer & Arno Vlist, 2014. "What role does the real estate–construction sector play in China’s regional economy?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 52(3), pages 839-857, May.
    • Handle: RePEc:spr:anresc:v:52:y:2014:i:3:p:839-857
    DOI: 10.1007/s00168-014-0613-5
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    Cited by:

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    3. Xu, Bin & Lin, Boqiang, 2016. "Assessing CO2 emissions in China’s iron and steel industry: A dynamic vector autoregression model," Applied Energy, Elsevier, vol. 161(C), pages 375-386.
    4. Sidong Zhao & Kaixu Zhao & Ping Zhang, 2021. "Spatial Inequality in China’s Housing Market and the Driving Mechanism," Land, MDPI, vol. 10(8), pages 1-33, August.
    5. Sidong Zhao & Weiwei Li & Kaixu Zhao & Ping Zhang, 2021. "Change Characteristics and Multilevel Influencing Factors of Real Estate Inventory—Case Studies from 35 Key Cities in China," Land, MDPI, vol. 10(9), pages 1-29, September.
    6. Yongming Huang & Jamal Khan & Eric Girardin & Umair Shad, 2021. "The Role of the Real Estate Sector in the Structural Dynamics of the Chinese Economy: An Input–Output Analysis," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 29(1), pages 61-86, January.

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    More about this item

    Keywords

    R15; L74; D57; C67;
    All these keywords.

    JEL classification:

    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods
    • L74 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Construction
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models

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