The impact of housing prices on the elderly labor market from the perspective of the regional innovation in China: focused on the wealth, the house poor, and the inheritance motivation effects

Abstract

With the transformation of China's economic growth rate from high speed to medium and high speed, the economic structure has been continuously optimized and upgraded, and the driving force of economic development has changed from investment-driven and factor-driven to innovation-driven. Under the background of the "new normal" economy, the traditional factor-driven economic development mode is unsustainable, and innovative factors have become the source driving force of regional economic growth. At the same time, with the transformation of new technologies such as the Internet and artificial intelligence, productivity and production methods have also been developed unprecedentedly, and the flow of innovation factors between regions has gradually expanded. According to the big data of population migration provided by Baidu Migration and Tencent Location, and the data of the sixth population census, the net inflow population is concentrated in the Beijing-Tianjin-Hebei, Yangtze River Delta, and Pearl River Delta urban agglomerations. It coincides with the difference in the prosperity and decline of the real estate market and the differentiation of housing prices. In recent years, the average sales price of residential buildings in China has risen rapidly, with the national average sales price rising from only 1,854 yuan in 1998 to 1,948 yuan in 2000, further rising to 4,725 yuan in 2010 and rising to 10,396 yuan in 2021, 5.61 times that of 1998. According to the data of the Chinese census and the 1% population sample survey, the number of elderly people over 60 years old has maintained a high level. The number of elderly people over 60 years old in 2000 reached 42.91 million, and in 2020, the number of elderly people over 60 years old reached 57.78 million, and the number of elderly employment increased by 14.87 million. Therefore, studying the impact of rising housing prices on the labor market of the elderly from the perspective of regional innovation has become the focus of current research, which is conducive to the healthy and orderly development of the elderly labor market. This study analyzes the multiple effects of the labor market and housing prices of the elderly, based on the new family economics theory, life cycle hypothesis, rational behavior theory, and intergenerational support theory. From the perspective of regional innovation, this study uses the data of the China Health and Retirement Longitudinal Study (CHARLS) in 2011, 2013, 2015, and 2018, to analyze the impact of housing prices on the labor market of the elderly and the intermediary mechanism of multiple effects of housing on the labor market of the elderly, and the results are as follows: (1) Whether from the perspective of labor supply time and labor participation behavior, housing prices have an obvious positive impact on the labor market of the elderly. This is mainly due to the continuous development of the regional economy driven by regional innovation, the rising of housing prices with regional innovation activities, and the increase in living pressure brought about by that the rising of housing prices drives the increasing participation of the elderly in labor. Rising housing prices have led to an increase in the cost of food, clothing, housing, and transportation for the elderly on a daily basis, and the more labor time for the elderly is required due to concerns about future risk pressures. (2) For the elderly with a high consumption level, the impact of housing prices on labor participation and labor supply is higher than that of the elderly with a low consumption level. According to the continuous development of regional innovation, the regional consumption level continues to improve and the consumption differentiation of the elderly is becoming more and more obvious. For the high consumer group, its consumption expenditure is large, often with the rise of housing prices, the increase in the cost of living is greater than the low consumption level. This makes the impact of housing prices on the labor participation and labor supply time of high-consumption elderly groups to be significantly higher than that of low-consumption elderly groups. (3) Due to continuous regional innovation, the differentiation of financial assets held by the elderly is more obvious, and financial assets are an important part of family assets. Older people with low financial assets showed a higher impact on labor force participation than older people with high levels of financial assets. Elderly people with high financial assets have a greater impact on labor supply time, and elderly people with high financial assets tend to increase more working hours. The rise in house prices will have an obvious crowding-out effect on the financial assets of families and financial assets will flow more to real estate. It will have a more obvious crowding- out effect on families with high financial assets, so that the elderly with high financial assets will produce more labor supply time. (4) Due to the dual economic structure between urban and rural areas caused by regional innovation, the cost of living for the elderly living in urban areas is more likely to occur with the rise of housing prices, providing more labor supply time. The elderly living in rural areas tend to be "self-sufficient" small-scale peasant economic models, which are relatively less likely to occur as housing prices rise, providing less supply of working time. (5) With the continuous advancement of regional innovation, house prices began to enter the upward range, the wealth effect of housing generated by rising house prices became more and more obvious, and the wealth effect made more housing assets of the elderly improved. Thereby it reduces the risk expectation of future life, reduces the tendency of the elderly to participate in labor, reduces labor supply time, and verifies that the wealth effect has an intermediary role in the process of house prices affecting the labor participation and labor supply time of the elderly. (6) Under the background of regional innovation, the rapid rise of real estate prices has strengthened the house poor effect in the current society, and the elderly will have a greater house poor effect due to the rise in house prices. Under the house poor effect, the house price has a significant impact on the labor supply time of the elderly. The house poor effect has an obvious intermediary role in the housing price affecting the labor participation of the elderly, and the house poor effect has an obvious mediating role in the housing price affecting the labor supply time of the elderly. (7) Affected by regional innovation, the inheritance motivation effect of housing has been continuously strengthened, the rise in house prices has made more families willing to use real estate as a means of wealth inheritance. The elderly, as the main participants of genetic behavior, has shown stronger willingness for participating in the labor market in the upward range of housing prices. It makes the inheritance motivation effect to show an obvious mediating effect in the impact of housing prices on the labor participation and labor supply time of the elderly. Finally, based on the research conclusions, this study puts forward relevant suggestions from five aspects as actively coping with the negative impact of the aging of the working-age population, continuously improving the re-employment mechanism of the elderly, developing comprehensive policies, promoting regional innovation, and designing the coordinated development of the elderly labor force and housing price market.

Keywords: Housing Price, Elderly Labor Market, Regional Innovation, Impact Analysis