The Unequal and Uneven Outcomes of Housing Reforms

In China between 1950 and 1975, urban housing policy went through several phases. In years when municipal and enterprise leaders decided to make housing a priority there was a steady increase in the supply of cheap housing. But in years when "more productive" investments were given priority (as was the case between 1961 and 1972), little was spent on new urban housing.^[28] Young couples or single adults could only find new quarters as members of larger, multigenerational households, and even couples with several young children were often required to share a suite with another young family in an apartment designed for one household.^[29] As a result, by the late 1970s crowding was almost as acute as it had been at the end of the civil war, and average per capita living space was actually 20 percent lower than it had been in the early 1950s.^[30]

The post-Mao leaders responded to this crisis with alacrity. In 1980 as much new urban housing was built as had been constructed during the entire Great Leap Forward, and one government source estimated that between 1979 and 1981, enterprises and city governments had rehoused the equivalent to the entire populations of Beijing, Shanghai, Tianjin, Guangzhou, Wuhan, and Shenyang.^[31] Surprisingly, however, given the rhetoric

[28] Reeitsu Kojima, Urbanization and Urban Problems in China (Tokyo: Institute of Developing Economies, 1987), 36-37.

[29] Liu Yirong, "Yinggai zhongshi yanjiu yishihu de sheji wenti" (We must research the problem of one-room apartments), Jianzhu xuebao , no. 5 (1981): 61-63; Shen Kuixu, "Zhengque quli zhujai sheji yu fen pei di guanxi" (Resolve the relationship between housing supply and allocation), Jianzhu xuebao , no. 12 (1981): 59-64.

[30] In August 1955 rents that previously had been set to provide maintenance and replacement were lowered in absolute terms. They were again reduced during the Cultural Revolution, thereby further widening the gap between expenditures and rents. Nicholas Lardy, "Consumptlon and Living Standards in China, 1978-83," China Quarterly , no. 100 (Dec. 1984): 856. One official Chinese source estimated that in 1979 average rents were 0.10 yuan per square meter, while cost to state was 0.38 yuan. "Urban Housing Rental," Beijing Review , Oct. 11, 1982, 27-28. In 1978 in 182 large cities households averaged 3.6 square meters per person; in 1952 the average had been 4.2 square meters. People's Daily , Aug. 5, 1980, 5, translated in FBIS , Aug. 20, 1980, 15-22. On rate of investment 1951-81, see Reeitsu Kojima, Urbanization and Urban Problems in China , 36-37.

[31] For 1953-1984, see Kojima, Urbanization and Urban Problems , 37, and Beijing Review , May 3, 1982, 9. In 1991 the second source estimated that between 1979 and 1989 three times as much housing was built nationwide than had been built in the preceding three decades, and 500 million people moved into new or rebuilt homes. Beijing Review , Jan. 14, 1991, 38.

of commodification and privatization of the Deng reforms, there was no sustained effort to pass on the costs in the form of higher rents. Instead, housing reform, to the extent that it was a reform, consisted of a decision to treble the share of housing in the capital-construction budget.^[32] The low-rent policy and the bureaucratic system of allocation remained in place (table 3.5).

By the mid-1980s, however, new ideas began to circulate, and for a brief period there was a flurry of publicity announcing a fundamental shift away from public housing.^[33] One of the most widely publicized models of change, sometimes called the Yantai plan, was a system whereby each employee was given a voucher to cover the real cost of building and maintaining what was defined as an adequate number of square meters of space (no price appears to have been placed on the land). Those who had more space than was considered necessary for their current household size were then to pay higher rents that approximated market value, and those who had less than adequate space would be given priority for renting or purchasing new housing.^[34] In addition, there were experiments in Yantai, and elsewhere, with outright sales both of newly built homes and of existing enterprise

[32] In 1978 housing took 7.8 percent of the construction budget; in 1981 and 1982 it went above 25 percent. Barry Naughton, "The Decline of Central Control over Investment in Post-Mao China," in Policy Implementation in Post-Mao China , ed. D. Michael Lampton (Berkeley: University of California Press, 1987), 66-67.

[33] Guowuyuan Gongbao (Bulletin of the State Council ), April 20, 1985, 270, and Beijing Review , Nov. 14, 1988, 18-20. A good summary of the several reforms is found in a commercially available neibu publication, Zhou Ying (ed.), Chengshi zhuzhai gaige cankao ziliao (Xinhuashe "Jingji cankao" bienjibu, n.d.; est. date of publication early 1988).

[34] RMRB , July 1, 1988, 5.

facilities.^[35] But by 1989, and particularly after the massacre in Tiananmen, central and municipal-level planners realized that at current wage levels, commercialization in the largest cities would be financially infeasible and politically destabilizing. Reforms were reduced to mild statements in support of gradual rent increases or lower housing subsidies, and plans for massive privatization were shelved.^[36] Housing continued to take a trivial fraction of a family's income, and in most instances one pack of high-quality cigarettes cost more than a month's rent.^[37] In fact, because wages rose steadily over the decade, the actual fraction of monthly income paid to rent fell to under 1 percent (see table 3.5).

In distributing apartments housing officials continued to establish a priority list according to the degree of crowding. However, even with the cutoff points as low as two or three square meters per resident,^[38] more families qualified for relocation than there were new flats available. As a result, housing cadres considered the composition as well as the size of the household in defining the degree of need. If a one-room household contained three generations, or if a two-room home had more than two married couples, the family was given priority. Even with these stringent guidelines, supplies were insufficient, and officials created priorities among the "needy" on the basis of the the family head's rank in the enterprise. Senior workers and staff jumped ahead of the more junior, and families of model workers or those who had suffered particular injury during the antirightist campaigns of the 1950s or the Cultural Revolution were given priority. Although the policy was not designed to encourage multigenerational homes, in practice it did. The most crowded homes were those like the Lis, the Zhaos, or the

[35] RMRB , March 11, 1988, 1; Oct. 11, 1988, 2.

[36] See Guofa , no. 11 and no. 13 (1988) in Guowuyuan Gongbao , 1988, 179-88; RMRB , Aug. 21, 1989, 1; Lu Shiming and Hu Anqi, "Shanghai zhufang zhidu"; Lu Xing, "Shanghai zhumin dui shangpinfang de xianchuan he qianjing de kanfa"; and Jan Middelhoek, "Urban Housing Reform in the PRC," China Information 4, no. 3 (Winter 1989-90), 56-72; Ming Bao (Hong Kong), July 4, 1990, 49, reports that in Guangzhou private building and buying continues, but at a cost of over 2,000 yuan per square meter it is simply beyond the average consumer. Similar sentiments were expressed by most Shanghai and Wuhan residents I met during my 1988 and 1990 fieldwork, although not in smaller Sha City where new blocks had entered the market at 200 yuan per square meter in December 1986, and rose to only 500 yuan by July 1988.

[37] In Shanghai in 1987 out of an average per capita income of 1,147 yuan, only 16 yuan (1.3%) went to rent and 30 yuan (2.6%) to utilities. Shanghai Tongji Nianjian 1988 , 410.

[38] In 1987 in Shanghai city, families with under 2 square meters per person were ranked as families in special need, but in practice, because after 1980 individual units supplied approximately 85 percent of new housing, the criteria varied from one enterprise to another and from one year to the next. In one collective enterprise described to me the cutoff in 1987 was 2.5 square meters, whereas in Watch Factory no. 4 it was 3 square meters in 1986 and 3.8 square meters by 1987, and in Textile Mill no. 6 it rose from 2.3 square meters in 1987 to 3 square meters in 1988.

Wangs, where a middle-aged couple had responsibility for sheltering an elderly in-law and several adult children. Newly married couples could apply to their workplace for a new apartment, but as a two-person household with little seniority they generally were deemed a low priority. Therefore, throughout the 1980s many newly married couples moved into the home of one of their parents, increasing the crowding of an existing household, but also moving the entire extended family further up the waiting list. Under this system, one should note that the household in line for the new apartment was that of the older generation, and thus when new flats did become available, the parents were assigned the new flat, and only through the intervention of the parents did the young couple receive an apartment of their "own." Moreover, if the parents had only one son or if a parent was already widowed, the housing authorities would allocate space with an eye to the parents' housing needs in old age and give priority to a joint or stem household rather than to the young couple. After new apartments were distributed to the most "deserving," the enterprise would then offer the recently vacated old flats to the more junior staff. Certainly some young couples did move into the newest estates immediately after their marriages, but among my respondents most of these lucky families obtained their new apartments through the intervention of their parents (see table 3.4). In a typical situation a parent (usually the father) had been assigned a new apartment as a reward for his seniority, but instead of moving to the new home himself he allowed a newly married child (usually a son) to live in the new apartment while the parents remained in the original place with other unmarried children or an elderly parent.

Urban China is hardly unique in its reliance on bureaucratic procedures rather than markets to distribute housing. Throughout the socialist world, and in segments of the capitalist economies, public housing allocated on the basis of need is commonplace. Moreover, in all these settings some families are more successful than others. Studies of urban housing in Eastern Europe in the 1960s and 1970s suggested that higher socioeconomic status often translated into more space and better amenities,^[39] and that the characteristics that predicted success in the workplace—Party membership, advanced education, urban birthplace—also determined housing outcomes. However, in Whyte and Parish's study of urban China in the 1970s, China appeared a somewhat deviant case. Professionals and Communist Party functionaries reaped few advantages from their social status, and overall urban housing was distributed more in proportion to need than to political position or wealth.^[40] The question is, to what extent did this egalitarian outcome persist during the housing boom of the 1980s?

[39] William Parish, "Destratification in China," in Class and Social Stratification in Post-Revolution China , ed. James L. Watson (London: Cambridge University Press, 1984), 93-96.

[40] Parish, "Destratification," 93-95.

Data from the official Chinese press suggest that the Deng reforms did not noticeably erode the basically egalitarian distribution of rents. For example, in Guangzhou in 1988, per capita monthly income was three times higher for families in the highest decile than in the lowest decile, yet rental burdens were virtually identical: 1.0 percent for families who averaged 84 yuan and 0.7 percent for those who averaged 245 yuan.^[41] Similar egalitarian outcomes were documented in official statistics and independent fieldwork.^[42] However, in the only report I have found that specifically compares distribution of residential space by the occupation of household head before and after the reforms, there is clear evidence of increasing inequality.^[43] In 1978 average per capita housing space for respondents in this study ranged from 4.8m² for families headed by a service worker to 6.3m² for those headed by a factory leader. By 1988 average household space had increased for all categories of staff, but the gains for those previously at the top were greater than for those at the bottom, and the absolute disparity between the lowest and highest had doubled.^[44]

Closer examination of the distribution of living space among the Shanghai families interviewed in 1987 documents similar discrimination against families headed by blue-collar fathers and also suggests how these inequalities in housing were created by the continuing role of enterprises as the brokers for most urban housing. All the families in my original 1987 sample lived in one new housing estate built in the first years of the post-Mao construction boom. Each apartment had the same number of rooms, but the layout and size varied in relation to the placement toward the staircases. Flats that ran parallel to the stairs had two rooms of equal size and contained twenty-four square meters of living space; those that were at the head of the staircase had one large room and one small room and contained twenty-seven square meters. Using the number of residents and the address of each family, I calculated the number of square feet each household occupied at the time of the first interview. And it is on the basis of these calculations that I was able to link the quality of housing and individual characteristics such as occupation and Party membership.

We can see from table 3.6 that despite the many shared characteristics of my respondents in terms of their age and their generally privileged

[41] Guangzhou Tongji Nianjian 1989 , 422.

[42] Guangxi Tongji Nianjian 1989 , 342; Beijing Shehui Jingji Tongji Nianjian 1989 , 564; Andrew Walder, "Collective Benefits and Social Stratification in Urban China," paper presented at the 42nd Annual Meeting of the Association for Asian Studies, Chicago, April 5-8, 1990.

[43] A study in five urban industrial units is summarized in Zhongguo Laodong Gongzi Tongji Nianjian 1989 , 350.

[44] Thus while service worker families gained on average 1.4m , production workers 1.6m , engineers gained 2.5m and factory leaders 3.3m . Zhongguo Laodong Gongzi Tongji Nianjian 1989 , 350.

socioeconomic position, families in this sample did not have equal, or even roughly uniform, shares of housing space. A small elite (N = 10) enjoyed more than twice the average space, while nearly a quarter of the families (N = 21) lived at the hardship level of three to four square meters per capita. In terms of family or individual characteristics that might explain this pattern of inequality, three items immediately seem salient. Those in poor housing had more children, fathers were more likely to be manual workers, and as a group they had the highest percentage of Party members.^[45] At first glance these observations seem contradictory. Upon further scrutiny, the outcome is consonant with what we know about the provision of urban housing in the semireformed political economy of Chinese cities of the 1980s.

The inequalities identified in table 3.6 document a bias against manual workers; they also reflect the impact of unequal institutional resources and the importance of unit-level patronage networks that reinforced class differences. The apartments in the neighborhood where I interviewed were built by the city government. However, the city had not taken sole responsibility for distributing the apartments. Instead, approximately half of the units

[45] I also examined age of mother, history of past political problems, and work status of mother. There was absolutely no difference by age of mother (57 years old in 1987) and thus it appears stage in the life cycle was irrelevant. Similarly the percentage with past political problems ranged between 9% and 10%, indicating no variation on this dimension. Only with percentage of mothers with blue-collar jobs did I find a difference, parallel with that found for fathers; the worst housed had average percentage (71%) while the best housed were far below average (20%).

had been sold to more than thirty different enterprises, which then in turn allocated flats among employees waiting for better housing. Therefore, while all families in my sample moved to these apartments as the result of successful supplication, the focus of entreaty and the criteria to establish a family's priority in the housing queue varied among employers. As a result, some of the inequalities documented in table 3.6 may be as attributable to the different resources of the units that had purchased the flats as to the different needs or prestige of the individual families. That is, it is possible that for the city slaughterhouse or district bottling plant, which had previously had no staff housing, this estate represented the first and best housing option, while for the import-export bureau, which was a long commute from this estate and which had long had its own hostels for its largely white-collar staff, the estate was not highly desirable. As a result, families who received their apartments from the import-export bureau were viewed by their unit as receiving only moderately good housing and did not have to document the same level of hardship to their enterprise housing office to qualify for relocation as those coming from the nearby slaughterhouse or bottling plant.

This is not to say that I found no individual characteristics that patterned the inequalities beyond the disadvantaged position of families headed by manual workers. On the contrary, both number of children and membership in the Party appeared to have an influence. In the case of family size the effect was in the expected direction. Parents with the most children had the greatest burden and therefore were most likely to live in the most crowded apartments. In the case of the disadvantage of Party membership, the result was quite unexpected. Placing this negative return on Party membership in the context of the bureaucratic allocation of housing, however, this anomalous finding becomes reasonable.

In urban China after 1955 most job changes were initiated by supervisors redeploying scarce talent.^[46] Blue-collar workers, therefore, had lower geographic mobility than white-collar, and Communist Party members, who were overrepresented in the professional and managerial roles, were more mobile than non-Party members.^[47] But because in urban China employees needed to cultivate personal connections in order to gain favorable treatment in the distribution of such benefits as new housing, mobility could be costly to the individual and his or her dependents. As a result,

[46] For a fuller description of this situation, see Deborah Davis, "Urban Job Mobility," in Chinese Society on the Eve of Tiananmen , ed. Deborah Davis and Ezra F. Vogel (Cambridge: Harvard University Press, 1990), 85-108.

[47] In the Shanghai sample, for example, 84% of blue-collar parents and 84% of nonparty members had worked in no more than two enterprises between 1949 and 1987; by contrast among the professionals only 40% were as immobile, and among Party members, it was only 39%. By the chi-square statistic both distributions were significant at the .001 level.

Party membership with its attendant higher rates of mobility could have negative rather than positive outcomes. Certainly at this point in our study of Chinese families, this conclusion is offered only as a hypothesis. However, it should be noted that in the case of these Shanghai families there is a clearly negative return to high mobility. Overall, 18 percent of fathers worked in four or more units between 1950 and 1987. Yet among the twenty-one families with the worst housing, 24 percent of fathers were this mobile, while among the ten who lived in the most spacious quarters there was not a single case of the highly mobile.