State, market, and family: housing inequality among the young generation in urban China

Abstract

Housing is critical to people's prosperity and wellbeing. In particular, housing status is closely linked to young people's life opportunities in many domains. With skyrocketing housing prices in many cities, housing outcomes of the current young generation in China are receiving increased attention. In this study, we examine the recent pattern of housing inequality among the young generation in urban China based on a large-scale national representative survey conducted in 2015, and we explore the importance of different types of factors. From an intragenerational perspective, we investigate the relative strengths between socialist institutions and market mechanisms. We also take into account the intergenerational channel by studying the impact of family background variables. We find substantial inequality in terms of home ownership, living space, and housing wealth among young people. While market ability variables, such as income and education, significantly affect housing consumption, institutional factors, such as the household registration (hukou) system, work units, and administrative rank, still play important roles in contemporary China. Furthermore, the impact of parental socioeconomic and political status is also nontrivial. In particular, the hukou status of young people and their parents has a sizable impact on housing consumption. China’s policymakers should pay more attention to the housing needs of young people and take concrete measures to expand the equality of opportunities.