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Valuing the Urban Hukou in China: Evidence from a Regression Discontinuity Design in Housing Price

Author

Listed:
  • Yu Chen

    (University of Graz, Austria)

  • Shaobin Shi

    (Shandong University, China)

  • Yugang Tang

    (Shandong University, China)

Abstract

This paper explores the demand side of hukou (household registration) acquisition in China by estimating the market valuation of urban hukou. According to the provisions in Jinan City’s “Acquiring Hukou by Purchasing Houses” policy, this paper uses houses slightly larger than the minimum required floor area as the treatment group, and houses slightly smaller than the minimum required floor area as the control group to perform regression discontinuity design. Empirical results show that residents’ willingness to pay for urban hukou in Jinan City was between approximately 90,000 and 126,000 yuan (RMB) in 2017. Our finding is robust to both parametric and nonparametric estimates and different model specifications. We also perform falsification tests by assuming a false policy introduction date and placebo tests based on rental data. Our analysis also offers insights for reform of the hukou system and designs for the provision of public services or welfare.

Suggested Citation

  • Yu Chen & Shaobin Shi & Yugang Tang, 2018. "Valuing the Urban Hukou in China: Evidence from a Regression Discontinuity Design in Housing Price," Graz Economics Papers 2018-14, University of Graz, Department of Economics.
    • Handle: RePEc:grz:wpaper:2018-14
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    More about this item

    Keywords

    Hukou system; Willingness to pay for hukou; Acquiring hukou by purchasing houses; Regression discontinuity design;
    All these keywords.

    JEL classification:

    • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • R38 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Government Policy
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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