lived at highly reduced prices. So therefore those people who were able
to buy a first apartment. As you can see in this graph, had much
higher capital gains than people who were buying a second or a third apartment.
because the second or the third apartment are usually acquired on the market, on
the private market. And therefore you don't have the kind of,
the kind of wealth transfer that you had in China from the public sector to the
private sector with early privatization. again, what you can see here is, is that
it's important of course to recognize even what we talk about the widespread
ownership of housing in China. That there's a tremendous difference in
terms of the quality of the housing. people who live in the bottom quarter or
the second quarter, their real estate has appreciated far less.
Than people who live in the top half of the income distribution in China
reflecting a phenomenon which is universal.
That while real estate as a whole has increased what the, what the Chinese call
the [UNKNOWN], the bubble of rising real estate values.
These are led especially by the better apartments.
because it is largely the better off population which is creating the demand
for more and more privatized higher value housing.
So, throughout the world, the Haves, as you see here defined by income, by
wealth, wealth, education, attainment and by occupational prestige.
In China the Haves there were also defined by such categories as work unit,
job sector, residence, geographic location.
Because a lot depends on where they were at the time of privatization.
If you are fortunate enough to live in the a very central location in Beijing or
in Shanghai, or in Shenzhen. You simply the net appreciation of your
real estate was much, much greater than if you were in a a more remote area, a
more remote residence. A less valued work unit or job sector
which didn't have the same kind of housing that a more desired more
prestigious work unit or job sector might have.
So in other words what we're looking at therefore in China is But there are two
types of have-nots. The kind of have-nots that we're more
used to in the west. Categorical have-nots, people who just,
you know, are poor. whether they are rural poor or urban
poor. In China you just have cohort have-nots.
People who are because of the real estate bubble those people who are in a cohort
that were able to take advantage of the early privatization.
And the realistic bubble did much better by period and again by age.
So young people in China facing the need to buy housing on the private market are
highly disadvantaged. Because their incomes simply don't give
them the possibility of buying an apartment on their own.
However, in China, as we've said, much wealth transfers from parents to children
occurs at marriage. Rather than at the death of parents.
So that therefore they're not so dependent on having to buy the apartment
themselves. But rather can rely to a large extent on
parental altruism and largesse, to acquire their needed real estate.
so underlying this pattern of equal wealth distribution is a pattern of
parental altruism and wealth distribution.
by contrast, home ownership is less equal say in the west.
this slide is from the United Kingdom. From a 2006 survey, and we can see that
for housing tenure by age. You can see that the young people in the
UK, very rarely own themselves own outright.
16 to 24 is 2%, 25 to 34 is 3%, 35 to 44 is 7% where it was 58% for under 35 in
the 2011 Chinese survey. So so far more unequal and far more
unequal especially by age. in the UK than in contemporary China.