China Real Estate Research Endowment Public Policy Perspective

The Unite Nations(UN) definite population aging as the proportion of thepopulation aged60and over exceeds10%of the total population, or the proportion ofthe population aged65and over exceeds7%of the total population in a country or aregion. According to UN’s standard of aging, China has become an aging societysince year2000. Compared with other countries in the world, the aging process ofChina’s population has several prominent features, such as a large base, rapidlygrowing and the huge need for long-term care. At the same time, due to the familyplanning policy, socioeconomic development and transformation and more womenparticipating in the labor market, the family size of China is much smaller than before.As a result, the traditional family support system for the elderly is quickly weakening.In response to the growing need for elderly care, China has promulgated a series ofpolicies aimed at promoting the Social Support System for the Elderly (hereinafterreferred to as SSSE) and encourage independent sectors to provide facilities-basedcare services for the elderly. Under this context, a new kind of real estate type, namely,Elderly Housing with care (hereinafter referred to as EHC) appears on the housingmarket. Now, the emerging industry is attracting various sources of investments.The practical experience of developed countries shows that the EHC can becomean effective tool of SSSE. But in China, what extent the EHC can carry elderly careservice is still unknown, there is also few success case in the market. Because oftabbed on “Real Estate”, the majority of the public and even government hold thetraditional view on EHC, so, the public opinion environment and policy environmentfaced by EHC is greatly uncertainty. In the existing literatures, most researchers focuson the business topics such as operation model, investment model and financing mode.However, there is little research about theoretical investigation and policy analysis. Asan emerging industry, it’s absolutely necessary to explore the business model of EHC.But, if we ignore the theoretical foundation issues, it will inevitably unable to copewith and solve the troubles and social misunderstandings encountered by EHC, it isobviously not conducive to the sustainable development of EHC.Based on the above, this paper attempts to take the perspective from publicpolicy, investigates on the fundamental issues related to the EHC development inChina. Compared with the existing literatures, the main works and the primary contributions of this paper contain the following points:Firstly, taking USA, Japan and UK as the study cases, I introduce theinternational experiences of the development of EHC. The paper also establishes acomparative analysis framework of EHC. The researchers prefer to introduce thebusiness management contents of EHC in the existing literatures. But in this paper, Ipay more attention to the overall current situation, historical evolution process andpolicy support system. I want to summarize the general rules and diversities of EHCbased on more systematic international comparisons, and also provide a consistentlogical framework to study the EHC in China.Secondly, I put forward a primary theoretical interpretation to the nature of EHC.At the first step, I classify the troubles and misunderstandings faced by EHC to threelevels: the industrial orientation, the public perception and the government policy. Theauthor suggests that these phenomena need to be explained in theoretically. Twoperspectives were provided. The first is based on public good theory, and the secondis from the industry property. From the perspective of pubic theory, the EHC can betreated as a private good with external effect or a quasi-public good, so, theoretically,EHC should acquire governments’ support. But the support may be various due to thedifferent kinds of EHC. From the perspective of industry property, I find it’s hard toclearly define the industry classification, because the real estate business and elderlycare service are two separated economic activities in a typical EHC sector.Thirdly, I design a policy framework for ECH in China. In discussing the policyissues related to EHC in China, the usual idea is selecting some specific policies toanalyze. In contrast, this paper focuses on how to design and establish a policyframework, as well as the thoughts and theoretical foundations behind the policyframework. With this objective, the policy framework integrates the two big reformthoughts since the reform and opening-up, i.e., top-down design and local experiment.It contains three organic compositions: classifying the responsibilities between centraland local government, promoting interactions between the government and society aswell as determining the policy priorities.