The Population Migration in Taiwan, and its Causal Relationship with Labor Market and Housing Market

Abstract

This study sets out to empirically examine the interrelationship existing between the labor market, the housing market and domestic interregional migration in Taiwan, with four of the most urbanized population receiving areas, Taipei City, Taipei County, Taichung City and Kaohsiung City, being selected for the study.

An error correction model is constructed for each city/county using time series data covering the period from 1974 to 1999, from which the research results show that each city/county has its own unique relational pattern between population migration, the labor market and the housing market, reflecting their different characteristics and developmental stages.

In Taipei City, the capital city of Taiwan, housing prices are much higher, although this has not been affected by migration or the labor market, since it is instead exogenously determined. In Taipei County, on the other hand, which is part of the Taipei metropolitan area and the major population migration destination, a close interaction exists between housing prices and population migration. As a latecomer in urban development, the relatively better organized city planning in Taichung City was reflected in all variables as being affected by the exogenous variable, local government expenditure. Although the industrialized city of Kaohsiung is faced with the growing problem of a loss of jobs, along with a housing market recession in recent years, the city?s net population migration has thus far been unaffected.
 

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