Housing Price Surge and Political Trust in Urban China: A Cohort-based Analysis

Abstract The unanticipated spillover effects of economic policies on residents’ political trust have seldom been discussed in the literature. This paper examines the impact of the rapid increase in housing prices, triggered by the economic stimulus policies implemented by the Chinese government in response to the 2008 financial crisis, on residents’ political trust. Empirical research based on data from the China Family Panel Studies (CFPS) indicates that the rapid rise in housing prices had differentiated effects on political trust among different age groups: it weakened the political trust of the younger and middle-aged groups but enhanced the political trust felt by elderly groups. Mechanism analysis reveals that the sudden and rapid rise in housing prices exacerbated younger people’s housing difficulties, suppressed their wealth accumulation and undermined their sense of self-efficacy, thus eroding their political trust. The findings of this paper not only extend the research on the formation mechanism of political trust but also broaden the research perspective of housing politics and provide new empirical evidence for understanding the complex dynamic relationship between economic development and political stability.