Urban housing demolition and entrepreneurship in China

The rapid urbanization and housing demolition in China have significantly impacted household behavior and economic activities. This article investigates how urban housing demolition influences entrepreneurial activities, using data from the China Household Finance Survey (CHFS). The study finds that housing demolition increases the probability of starting a business by 4.5 percentage points, with varying effects across different demographic groups. The positive impact is more pronounced among younger, higher-educated individuals, non-cadre individuals, and those living in eastern regions. The mechanism analysis reveals that housing demolition directly increases household assets and reduces the demand for bank loans, thereby alleviating credit constraints. However, the entrepreneurial activities induced by housing demolition do not significantly lead to increased employment. The article also discusses the limitations of the study and suggests areas for future research, providing a comprehensive overview of the complex interplay between urban housing demolition and entrepreneurship in China.