Human capital agglomeration, urbanisation and housing prices in China: evidence from quantile regression

Purpose We examine how human capital agglomeration and urbanisation jointly shape housing price dynamics in China. We aim to disentangle their distinct mechanisms and assess whether the effects of human capital concentration are consistent across different market segments. Design/methodology/approach Using balanced panel data from 31 Chinese provinces between 2002 and 2021, this study applies quantile regression techniques to capture the heterogeneous effects of human capital agglomeration and urbanisation across the housing price distribution. Findings The results reveal that human capital agglomeration significantly increases housing prices in lower-to-middle quantiles, reflecting agglomeration externalities and productivity gains in moderately priced markets. However, its influence weakens in the upper quantiles, where rapid urbanisation and congestion externalities dilute these benefits. Conversely, urbanisation exerts negligible effects at the lower end but increasingly negative impacts in high-priced regions, suggesting the presence of urban diseconomies and inefficiencies in spatial allocation. Research limitations/implications The findings underscore the need for differentiated and integrated policies aligning human capital clustering with balanced urban planning. Coordinating these dimensions can mitigate urbanisation-induced diseconomies and support more sustainable growth of the housing market. Originality/value By differentiating human capital agglomeration and urbanisation within a spatial equilibrium framework, this study identifies their distinct heterogeneous effects across the housing price distribution. Using a quantile regression approach, it reveals that the influences of human capital agglomeration and urbanisation are not constant but vary systematically across low, medium, and high price segments, thereby providing new distributional evidence on the driving forces of China's housing market heterogeneity.