Journal of East China Normal University (Philosoph ›› 2017, Vol. 49 ›› Issue (1): 146-153.doi: 10.16382/j.cnki.1000-5579.2017.01.019

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Has High Housing Price Inhibited the Entry of New Firms?: Evidence from China's Industrial Firms

HU Cao, FAN Hong-zhong   

  • Online:2017-01-13 Published:2017-02-18
  • About author:HU Cao & FAN Hong-zhong)

Abstract:

Based on China's industrial firm level data during 2001-2007, this paper applies Negative Binomial Model to estimate the impacts of housing price on the location of new manufacturing firms. Because of the wages of China's manufacturing workers do not relate with housing price and the monopolization of China's land market, high housing price has not hindered the entry of new firms but obviously increased its possibility. This is not conducive to the reasonable spatial distribution of China's firms. Therefore,in order to lead to a reasonable distribution of China's firms among cities of different sizes and narrow the economic development gap between regions, it is necessary to adopt policies to raise workers' wage bargaining power and weaken the monopolization of China's land market.

Key words: housing price, firm location, entry of new firms, Negative Binomial Model