The 1994-1998 housing reform in China permitted state employees to purchase their public homes at a substantial discount. By exploiting housing reform as an exogenous change in homeownership and employing a differences-in-differences framework, this paper examines the effect of housing reform on labor market participation. Utilizing data from the China Health and Nutrition Survey and the China Health and Nutrition Survey, we discover that people who are affected by reforms to housing will be 15.1 percentage points less likely in the labor market once we have controlled for observable variables. Further, we discover that married females are 18.9 percentage points more likely to be out of the workforce following the reform to housing. In contrast, the males in their respective households are 10.0 percent less likely to be in the labor market after the reform. We also investigate how the reform to housing may impact married women more severely. The family division of labor theory suggests that in a well-functioning family, the husband should be the “breadwinners,” and the wife should be the primary caregiver and accountable for the care of the family. We investigate this theory and have found strong evidence to suggest that married women have been more involved in household chores since the reforms to housing. Our findings stand up to other estimates and misspecifications regarding functionality.

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Notes

1. “Work unit (danwei) generally means a specific type of workplace within the context of state socialism in which the workplace is a part of the government apparatus and performs the role of social management in addition to supervision (Wu 1996).
2. This study uses data from the China Health and Nutrition Survey (CHNS). We are grateful to our sponsors, the National Institute for Nutrition and Health, the China Center for Disease Control and Prevention, the Carolina Population Center (P2C HD050924, T32 HD007168), and the University of North Carolina at Chapel Hill,e NIH (R01-HD30880 DK056350, R24 HD050924, R01-HD38700) and the NIH Fogarty International Center (D43 TW009077, and D43 TW007709) to provide financial assistance for CHNS data collection and analysis files from 1989 to 2015. CHNS information collection and analyses files from 1989 through 2015, and for future surveys, as well as the China-Japan Friendship Hospital Ministry of Health for support for CHNS 2009, Chinese National Human Genome Center located in Shanghai since 2009 and Beijing Municipal Center for Disease Prevention and Control since 2011.
3. Visit the CHNS official website http://www.cpc.unc.edu/projects/china for detailed information about survey design, samples, data collection, quality control procedures, and questionnaires.
4. We are grateful to Kelvin Wong’s help pointing out this crucial issue to our attention!
5. The probit model with fixed effects can result in an incidental parameter problem (i.e., the inconsistency in the estimation of coefficients). According to Abrevaya (1997), We employ the fixed-effects logit model to address the “incidental parameters problem.”

This study improves knowledge of mortgage defaults by examining how borrowers make decisions during discussions. We discuss two major issues in the research: (1) Does a borrower have a different experience between legal and psychological contracts? and (2) Does equity aversion, or the fear of being a victim, affect the decision of a borrower from the mortgage default settlement agreement? Our research suggests that the borrowers don’t confuse legal and psychological contracts in this context, as it contradicts prior research findings. Moreover, as defaulting borrowers appear to place relatively little value on a clean credit report, they do not differentially enter/withdraw from contract negotiations based on a lender’s unwillingness/inability to clear their credit report. This finding is against the established notions and could reflect the growing gap between the U.S. between individuals and large institutions. In particular, borrowers do not seem to be able to trust lenders as well, and they are not particularly concerned about traditional indicators of risk-sensing and underwriting like credit reports. To efficiently and effectively solve the vast amount of mortgages that are toxic and indebted debt, a method of negotiation with borrowers that takes into account the current norms needs to be taken into consideration; the analysis of another dataset indicates that these findings were based upon the social and legal framework that exists in the U.S. and, therefore, might not apply to other nations.