ORIGINAL RESEARCH article
Front. Sustain. Cities
Sec. Urban Economics
Volume 7 - 2025 | doi: 10.3389/frsc.2025.1621967
Does environmental regulation decline or boost housing prices? Empirical evidence from panel data of Chinese cities
Provisionally accepted
- Zhangzhou Normal University, Zhangzhou, China
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China's industrialization process, transitioning from a heavy industry-oriented strategy to ecological civilization construction in the new era, has shaped the intrinsic connection between environmental regulation and the real estate market. Based on panel data from the government work reports and economic development of 280 prefecture-level cities in China from 2003 to 2023, this study constructs an environmental regulation index using an improved TF-IDF algorithm to examine the impact of environmental regulation on housing prices and its underlying mechanisms. It innovatively employs historical railway inauguration data in China as an instrumental variable. Fixed-effects model results reveal that the impact of environmental regulation on housing prices exhibits a Ushaped pattern, with a predominantly inhibitory effect at the current stage. The mediating effect model further reveals that environmental regulation indirectly affects housing prices through promoting industrial structure upgrading and green technological innovation. The industrial green transformation transmission mechanism in the impact of China's environmental regulation on housing prices may become one of the micro-implementation pathways for the global sustainable development goals.
Keywords: environmental regulation, Housing prices, property market, Panel data, Mediating effect
Received: 08 May 2025; Accepted: 11 Aug 2025.
Copyright: © 2025 Peng, Wu and Xu. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY). The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.
* Correspondence: Manman Wu, Zhangzhou Normal University, Zhangzhou, China
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