The rising of house prices and the global value chain position of China’s manufacturing sector

Rising housing prices are a concern for manufacturing development. Using a panel data set of 31 China’s provincial regions from 2005 to 2020, this study explores the overall and time-varying impacts of rising house prices on the global value chain position (GVCP) of manufacturing sector in China through theoretical and empirical analysis. Moreover, this study explores the underlying mechanism of rising house prices on the GVCP of China’s manufacturing sector from an innovation environment and industrial structure perspective. Data from Chinese regions show that rising house prices positively affect the GVCP of China’s manufacturing sector, but the impact weakens over time. In addition, a positive innovation environment and advanced industrial structure strengthen this relationship. Accordingly, adapting house price policies to regional realities, enhancing and attracting foreign direct investment, and enhancing regional economy of scale are presented as policy recommendations. This study strongly complements and extends existing studies on house price effects and global value chains, and provides valuable insights for informed policymaking to enhance a country’s manufacturing sector and overall socio-economic and environmental well-being. A possible limitation of this study is the limited examination of external factors, leaving room for future investigations.