Market Transition Theory Revisited: Changing Regimes of Housing Inequality in China, 1988-2002

Abstract

This paper revisits the market transition theory of Nee (1989), using housing as an alternative to income as a measure of socioeconomic attainment. We argue that housing space is a better outcome variable by which to evaluate Nee's market transition theory because it is a more consistent measure of socioeconomic success than income before and after the economic reform. Using three waves of a national household survey in 1988, 1995, and 2002, we compare temporal changes in the role of market and redistributive determinants for income and housing space. In support of a weak form of the theory, our results show that market determinants replaced redistributive determinants over time as the most significant predictors of housing space. In contrast, parallel analyses of income show mixed results for market and redistributive determinants.

Social determinants of household wealth and income in urban China

“…For instance, housing historically was publicly owned and distributed among urban residents on the basis of need, in a system also known as the Welfare Housing Policy. Housing reform legalized the privatization of housing, and housing ownership was transferred to existing inhabitants at deeply discounted prices (Song and Xie, 2014; Walder and He, 2014), which abruptly increased the wealth holdings of the urban residents (Chen and Qiu, 2011). …”

Buying out of familial obligation: The tradeoff between financially supporting versus living with elderly parents in Urban China

“…Third, the data we used were collected in 1999, and thus information may not be up to date. Since 1999, housing privatization has led to a boom in the real estate market and rapid rises in the costs of housing units in most Chinese cities (Song and Xie, 2014). Thus, economic pressure has increased, most likely pushing intergenerational transfers further downward than before and further favoring child-centered living arrangements that maximize children’s interests.…”

Feeling good about the iron rice bowl: Economic sector and happiness in post-reform urban China

“…In examining how market transition has affected inequality, previous studies have overwhelmingly focused on objective outcomes such as income (e.g., Cao and Nee, 2005; Gerber and Hout, 1998; Wu and Xie, 2003, Xie and Hannum, 1996), employment (e.g., Gerber and Hout, 1998; Wu and Xie, 2003), or housing (Song and Xie, 2014). We expand the research scope of how market transition may have affected social inequalities in life chances by adding the subjective well-being as a topic of study.…”