A Burden or A Tool?

Public housing can be an important component of state services, providing government-subsidized, affordable homes and limiting risks for vulnerable or disenfranchised populations. Local governments often play a key role in shaping and financing public housing programs, yet are subject to economic constraints that impact their ability to implement their programs. As a result, public housing is often framed as an economic burden to the public sector, especially in the context of developing countries.

In 2008, China unveiled a $586 billion stimulus package to bolster its economy. An element of the package included the China’s Twelfth Five-Year Plan (2011-2015) which announced an unprecedented target to build 36 million public housing units. In this plan’s vision, public housing would comprise over 20 percent of China’s housing stock by the end of this period, rising from 7-8 percent in 2011. Throughout China, constructing new public housing has become a common strategy to resist economic shock and stimulate domestic consumption for the short term, while also housing more low-income populations and bridge economic and social-political goals for the long term.

In their recent publication, “A Burden or A Tool? Rationalizing Public Housing Provision in Chinese Cities” (Housing Studies, 2019), doctoral candidate Colleen Chiu-Shee and Associate Professor Siqi Zheng examine the factors contributing to a negative perspective of public housing. Zheng and Chiu-Shee also outline an argument for the contributive roles of public housing in mixed economies.

Tapping into China’s most ambitious public housing provision plan, Chiu-Shee and Zheng situate their study in the global discourse about the general linkages between public housing and economic development and highlight the beneficial roles of public housing in building human capital, stimulating economic productivity, and enhancing socioeconomic inclusivity.

“Public housing provisions have become an important criterion for officials’ promotion in China. The top-down public housing provision plan led to both heterogeneity and commonality in municipal responses,” said Zheng. Chiu-Shee and Zheng’s research tackles the complexity in variegated local strategies in China by parsing the underlying rationales of city-specific public housing programs in response to central mandates. They focus on the unique experiences of two major cities exemplifying different development stages—Chongqing as an industrializing city and Shenzhen as a de-industrializing one—and contextualize policy goals and provision strategies in local conditions of urbanization. They reflect on political, socioeconomic and spatial considerations and reveal unstated rationales underlying municipal strategies.

“The two cities’ public housing programs differed in three aspects—target population, spatial strategy and public housing producer,” said Chiu-Shee. “Yet, we found that both cities planned public housing as an instrument to stimulate economic growth and control population. They aimed to provide public housing for desired labor and relaxed hukou restrictions in public housing eligibility. As a result public housing became the entry point for desired workers from elsewhere to settle down in the city. Public housing projects were strategically integrated with urban development plans in both cities, carefully sited to enable labor concentration, promote place-making, and generate higher land-based incomes and tax revenues. So, both cities planned public housing programs to enable economic, social and spatial transformations.”

Chiu-Shee and Zheng integrated their empirical findings into an open-ended framework that forges intricate links among cost-benefit considerations which correspond to housing’s consumptive and productive characteristics. This framework systematizes hypotheses that assemble the patterns of dynamic relationships among constituents of local decision-making, mediating the dimensions of development stage, time and space. It facilitates a new and illuminating way of conceptualizing policy rationales and of explaining variations in local programs.

The research is supported by the Social Science Foundation and the State Council’s Development Research Center in China. It is further developed at the China Future City Lab at the Massachusetts Institute of Technology.