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Do talent housing policies foster regional innovation? An analysis based on labor force heterogeneity

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  • Qiu, Jun
  • Lyu, Ping
  • Tian, Min

Abstract

Human capital plays a crucial role in regional innovation and economic progress, which has increasingly been highlighted in research. However, rising housing costs in cities can push talent away, causing brain drain and hindering local innovation. Within this context, China has seen widespread adoption of talent housing policies (THPs) aimed at providing housing assistance for the high-skilled labor force, although the ramifications of these initiatives remain largely underexplored. Based on labor force heterogeneity, this study investigates the effects of THPs targeted at high-skilled labor on the mobility of both high- and low-skilled workers and their consequent impact on regional innovation. Our findings reveal that while THPs bolster the local pool of highly skilled human capital and attract more low-skilled workforce, enhancing regional innovation through labor–skill complementarities, they concurrently elevate housing costs for low-skilled laborers, reducing their long-term settlement intensions and potentially hindering a city's innovation trajectory.

Suggested Citation

  • Qiu, Jun & Lyu, Ping & Tian, Min, 2024. "Do talent housing policies foster regional innovation? An analysis based on labor force heterogeneity," Economic Analysis and Policy, Elsevier, vol. 83(C), pages 150-164.
    • Handle: RePEc:eee:ecanpo:v:83:y:2024:i:c:p:150-164
    DOI: 10.1016/j.eap.2024.06.005
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