*3.3. Measures*

Dependent variable 1 is the total value of the main residence. Because the property market in China is relatively mature, the housing price of the respondents includes information about housing quality and housing location, which is a suitable variable to represent the distribution of housing resources. Dependent variable 2 is the added value of the house after purchase or construction. Because respondents are asked on the questionnaires

to provide the date when they purchased or built their house and the cost of doing so, the added value of the house in question can be calculated from the date of the contract to the year 2012, when the survey was conducted. This variable indicates the profit of respondents from the property market and allows us to more accurately operationalize incremental resources in the process of market transition. Logarithms have been taken of the two variables in the OLS model because the two variables are skewed to the right. Although it is necessary to take logarithms in the quantile model, natural logarithms of dependent variables have been used improve the comparison of the results of the OLS model. The main independent variables are as follows:


Another independent variable warranting attention in this paper is the time when the house was purchased or built. Although this independent variable is a continuous variable on the questionnaire, this paper de-dimensionalizes it into four nominal variables: before 1998, 1999–2003, 2004–2008, and 2009–2012. The years 1998, 2003, and 2008 are selected as key division points due to theoretical and historical reasons. According to the research conducted by Wu Xiaobo [34], the then incumbent Zhu Rongji administration suspended the policy of selling state capital to private businesses, which targeted the stateowned small and medium enterprises with poor performance. After 1998, state-owned capital withdrew from competitive industries, such as textiles, home appliances, and food, while playing a dominant and monopolistic role in strategic industries, such as resources, energy, and heavy chemicals. State-owned businesses started to retreat to the upper-stream industries, forming an advantage of an oligarchy or multi-oligarchy operation.

After 1998, the housing of urban residents transformed from work–unit-distributed houses into commodity houses for transactional purposes. At the end of 2003, the State Council released *Provisions on Curbing Blind Investment in Steel, Electrolytic Aluminum, Cement and other industries*, to manage the over-popular investments in energy industries. Additionally, in 2003, the State-Owned Assets Supervision and Administration Commission of the State Council was founded. In the following three years, the main business income of enterprises directly under central authorities increased by 78.8%, the profit increased by 140%, the tax revenue increased by 96.5%, and the hedge ratio of state-owned assets increased to 144.4%. Feng Lun, then chairman of Wangtong Group, said, "Faced with stateowned capital, private capital has to stick to the principle of cooperation over competition, supplement over substitution, affiliation over dominance. Only by accomplishing this can the private capital advance continuously and fare well".

In 2008, because exports were hindered by the financial crisis, the central government implemented a proactive fiscal policy—a USD 4 trillion economy stimulus package. As a result, state-owned enterprises gained 90% of the new loans. Above all, 1998 was the starting point of the commodification of housing, and 2003 and 2008 were significant years because the administration increased the investment in state-owned capital and private capital withdrew from the production field during the process of market transition. Furthermore, the private capital withdrawn in 2003 and 2008 was mostly transferred to the financial market, in which the real-estate market, as the fastest-growing value-added investment, received substantial attention. In the process of property investment, local governments also profited from land finance, namely collecting land transaction fees by transferring land use rights [35]. Additionally, state-owned enterprises can profit from the upstream industries resulting from property construction. A prohibitive housing price scenario is the result of the common interests of private capital, local governments, and state-owned capital. Therefore, the years 1998, 2003, and 2008 are particularly important because they have different implications for housing prices. The time when the property market was entered is divided into four stages.

The descriptive statistics of the aforementioned variables are in Table 1.

**Table 1.** Descriptive statistics of variables.


**Continuous Variable Variables Sample Numbers Mean Gini Coefficient Standard Deviation Minimum Value Maximum Value** Self-employed entrepreneur 2904 363 12.5 0.3308 0 1 Worker after retirement <sup>3</sup> 2904 36 1.23967 0.1107 0 1 Others 2904 4 0.00138 0.03712 0 1 Party member (Yes = 1, No = 0) 3263 510 15.62979 0.3632 0 1 Marriage status (Yes = 1, No = 0) 3258 2536 77.83917 0.4154 0 1 Family member number 3260 7564 232.0245 1.2309 0 9 Gender (Male = 1, Female = 0) 3263 1602 49.09592 0.5 0 1 Province Shanghai Municipality 3263 837 25.6512 0.43677 0 1 Yunnan Province 3263 368 11.278 0.31637 0 1 Jilin Province 3263 575 17.6218 0.38106 0 1 Guangdong Province 3263 735 22.5253 0.41781 0 1 Henan Province 3263 392 12.0135 0.32517 0 1 Gansu Province 3263 356 10.9102 0.31181 0 1

**Table 1.** *Cont.*

<sup>1</sup> Values less than 0 were taken of the three variables—housing value, housing added value, and income—and the natural logarithms were taken from the model. <sup>2</sup> All discrete variables were changed into dummy variables and then added into the following model. <sup>3</sup> The group working after retirement is not included in the regression model.
