Eliminating Hukou
To address current housing issues in Shanghai, we first recommend a gradual abolition of hukou. It was a place-based registration system enacted in 1951 to facilitate central economic planning and control the movement of people. Under this system, all residents are given a domestic passport, with their healthcare, education, housing, and jobs allocated by their registered location. The hukou system’s restrictive mobility was a response to the disparity in living conditions between cities and rural areas — work units in cities provided somewhat higher living standards than rural farming collectives, and the system was designed, in part, to prevent mass migration by peasants seeking better lives. The division of communal lands in the 1980s left many with too little land to feasibly farm. This, combined with the government’s strategic overlooking of migration violations — migrants being essential to the construction and manufacturing sectors underpinning the Chinese economic boom — sparked a mass-migration to Chinese cities. Despite the changing reality of urban-rural population distributions, the hukou system remains substantially unreformed. Phasing out hukou could aid in equalizing the urban-rural and intra-urban socio-economic inequalities seen in China.
While hukou has not stemmed the tide of migrants to cities like Shanghai, it has created a dual-tiered citizenship, as individual education and healthcare access remain tied to people’s land categorization. This leads to highly unequal educational, health, and income outcomes between urban-registered citizens and rural-registered migrants, as city resources are better but not available for rural-registered use. Additionally, hukou exacerbate the destabilization of family structures under capitalist development; many young adults migrate to cities in search of jobs, while their children and parents remain in the villages to continue to receive state-funded healthcare and education. Urban citizens also push back against rural migration in fear of too much stress being put on the system, with the potential to worsen even urban living and working conditions. This lack of citizenship rights for rural migrants also heightens the inequity of displacement from urban development; for example when rural-registered city-dwellers are displaced, they do not receive any of the compensation that urban-registered residents do.
Elimination of hukou does carry some costs which must be acknowledged. Considering the amount of migration that has occurred in spite of this barrier to mobility, it is likely that sudden removal of hukou would lead to an even greater migration into the main cities of China. Lu and Wan (2014) actually support the abolition of hukou on this basis, seeing the system as having inefficiently inhibited city formation. Such migration would, at least in the short term, worsen the housing issues seen in Shanghai. Gradual, transitional abolition of hukou in order to expand supply to meet the expected increased demand for housing in Shanghai thus seems more attractive than immediate abolition. Additionally, though we recommend the gradual elimination of hukou in the interests of migrants, it must be accompanied by other reforms to improve housing affordability and steer Shanghai’s development towards a more inclusive course.
Political-developmental reforms
China’s urban land ownership model presents potential hope for a more equitable development path. In the U.S. and Europe, community land trusts (in which a nonprofit buys up land and then leases housing on that land to residents) have recently garnered attention as a potential solution to gentrification by negating the pressures of land appreciation on residents. China’s urban land regime currently provides a wide-scale model of such a system, except with state, rather than nonprofit, ownership of underlying land rights. The fact that Shanghai’s housing is characterized by ongoing displacement, despite this public ownership of land, indicates a key pitfall of land trusts: namely, that the possessor of land trusts must intend to minimize displacement. Tackling Shanghai’s housing issues is only achievable through a reorientation of state structures and goals.
Expanding community power in determining urban development is vital for leveraging this land ownership model to combat displacement and democratize development. Shanghai’s urban development has hitherto been directed by state and large developer interests, with little regard for citizen or community input or need. Community-oriented housing strives for development that includes the ability to walk or easily transport oneself between home, jobs, and resources. Implementation of such housing encourages community interaction and centralized community space designed for neighborhoods. In particular, community power hinges on the ability for members of the community to have a say in housing provision and development, thereby minimizing displacement and maintaining the rich social ties that develop in a community.
Closely associated with this is our recommendation that China return to on-site relocation of residents. Off-site relocation was part of the market-based reforms of the early 2000s, as the development of Shanghai became steadily liberalized and the logic of new-build gentrification expanded. It has resulted in the uprooting of people from their communities and the forced suburbanization of the working class, with many residents now forced to take excessively long commutes to their jobs in the city center. Returning to on-site relocation would require that Shanghai integrate existing residents into its new, gleaming districts and spread the potential benefits of this development more broadly. On-site relocation must be accompanied, however, with public housing benefits to ensure the continued affordability of those new housing units to those displaced in the interest of urban development. There are drawbacks associated with providing on-site public housing, as more public units could theoretically be provided in cheaper, less central locations. Nevertheless, we believe that the numerous advantages of this policy, in terms of preventing housing segregation, curtailing displacement, and making the city itself more inclusive, outweigh the costs.
- Lu, Ming, and Guanghua Wan. 2014. “Urbanization and Urban Systems in the People’s Republic of China: Research Findings and Policy Recommendations.” Journal of Economic Surveys 28 (4): 671–685.
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