ABSTRACT
In the People’s Republic of China, urban housing has been mainly constructed and managed by local governments and public-owned enterprises. This paper enriches the existing literature in three main areas. First, using a rich and unique data set on urban housing in 1991-1994, the paper examines disparities in housing construction and consumption and finds that both vary significantly across Chinese cities. Second, this paper analyzes the coexistence of a housing shortage and a large amount of unsold housing in urban China. It argues that such coexistence is mainly caused by a huge price gap between the traditional public housing and the new commercial properties, excessive government taxes and fees, and a primitive housing market. Finally, the paper defines factors that affect Chinese urban housing investment and consumption. The empirical findings suggest that the public sector still plays a crucial role in urban housing in China, though some market-oriented factors have started to influence housing investment and consumption.
