Do House Prices Affect Fertility Behavior in China? An Empirical Examination

Abstract

The article provides findings for China that are consistent with the studies that document a negative relationship between the cost of housing and fertility. Although some studies have questioned the negative relationship between housing market prices and fertility, overall the evidence from this large sample study in China suggests that the original interpretation of a negative relationship is still viable. The research uses data from the China Household Finance Survey between 2013 and 2017 to show that there is an approximately 0.94-percentage-point decrease in the probability of having a child under two with a 1 percent increase in housing prices. The article provides instrumental models to account for endogeneity. The results are robust across city levels and by wife’s age. The negative effect is significant in the thirty-five large cities in China but not significant for other smaller cities.