The impact of urban housing prices on labour mobility: evidence from cities in China

Abstract

Urban development relies heavily on labour, while the change in urban housing prices, in turn, has a crucial impact on labour. Therefore, the regulatory policies of housing prices have become a critical content of urban management worldwide for a long time. Based on the theoretical analysis of urban housing prices and labour mobility, we use fixed-effect panel model with the panel data of 281 cities in China from 2002 to 2018. We study the impact of rising urban housing prices on labour and identify the housing price jump as an instrumental variable in solving the endogenous problem. The results are as follows. First, the increase in urban housing prices has a crowding-out effect on labour mobility. Second, there is a moderating effect on different levels of education, urban construction, and income under the impact of urban housing prices on labour mobility. Third, the heterogeneity of the impact is reflected in the housing price-to-income ratios and industrial structures. These conclusions are supposed to have significant enlightenment for controlling the urban housing prices during high-quality economic growth and guiding labour flow more rationally.