Abstract
We use the 2011 and 2013 waves of the China Household Finance Survey (CHFS) to study the extent to which the acquisition of multiple houses is determined by the presence of male children in the family. We conjecture that, as a result of the very high sex ratio which can be observed in China following the one child policy, Chinese families who have a son may want to acquire additional dwellings to enhance the marriage chances of their son. In support of this argument, we find that families with male children aged 25 or older are most likely to acquire additional houses. This effect is highest in regions characterised by higher sex ratios, especially in rural areas.
Highlights
The Chinese housing market has witnessed a boom over the last two decades
We provide a brief overview of the housing reforms in China, and describe the literature on multiple-home ownership in China, as well as research relating to son preferences, sex ratios, and home ownership
If the acquisition of additional houses is motivated by the desire to enhance the marriage prospects of sons, as discussed in Sect. 3.2, we expect the association between male children close to marriage age and multiple-home acquisition to be stronger in provinces characterised by higher sex ratios
Summary
The Chinese housing market has witnessed a boom over the last two decades. Following the privatization of the housing sector in 1998, home ownership in China has risen substantially, standing at roughly 90% compared to about 65% in the US (Glaeser et al, 2017). We propose an alternative explanation, centered on the role of male children present in the family This line of research is motivated by literature, which has suggested that due to the unbalanced sex ratio in China, those parents who have a male child save more in order to improve their son’s marriage prospects (Wei and Zhang, 2011). We investigate whether the association between having a son and multiple-home acquisition is stronger in those provinces characterized by a more unbalanced sex ratio This would support our hypothesis that the acquisition of multiple dwellings is driven by a desire to improve sons’ marriage prospects. We find that Chinese families with at least one son aged 25 or above have a significantly higher probability of acquiring an additional home This effect is highest in regions characterized by a high sex ratio, especially in rural areas.
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