1、Positive Relation between House Price and Official PromotionWhy does the housing price in China keep increasing？ People usually attribute to the progress in urbanization， the rigid demand for houses， and the vigorous market of investment and speculation. Prof. Deng Yongheng from the National Univers
2、ity of Singapore and Prof. Wu Jing from Tsinghua University now gave out another reason. They made massive researches into the land prices of 35 cities of China and unsurprisingly connect the increasing house price to the land price. Whats really worth attention is the byproduct of this research. Th
3、ey found that the increase in house price is positively related with the promotion rates of mayors and Party secretaries of different cities. Concretely， if the leaders of a city put more money into the transportation facilities and real estate， the citys GPD will be greatly improved and the Party s
4、ecretary has 4.76% additional probability to get promoted and the mayor is 10% more likely to get promoted. In reverse， if the leaders put more money into the disposal of water and air pollution or any other environmental protection， the Party Secretarys promotion probability drops 8.5% while the ma
5、yors drops 6.3%. The newlyfound positive relation between the house price and the promotion of governmental officials just provides a solid proof for the long-existing viewpoint that developing the real estate is helpful for the promotion of local governmental officials. This is finally related to t
6、he fact that GDP is still an important reference to review local governmental officials political performance and decide their promotion. When the economic growth goes slow， the real estate is the best way to improve the GDP for local governments and it also serves as an important source for the loc
7、al financial income. In the past few years， the real estate was always among the greatest contributors ? if not the single champion contributor? to the financial income. The report about the financial income of 30 provinces/municipalities/autonomous regions in China showed that the financial income
8、of local governments continued to drop， but the real estate is still the pillar for the financial income. In some provinces， the income from real estate even takes more than half of their financial income. Wang Jun， Director of the General Administration of Taxation， once said that the tax from real
9、 estate takes too high a proportion of tax income of local governments. The lack of driving force for the economic growth makes local governments more dependent on the real estate， because the mayors and Party secretaries fear that they might not be promoted to higher positions if the economic data
10、of their places is too“bad”. Therefore， the current system of reviewing the local governmental officials performance， which closely relates the GDP with these leaders future， is to blamed for the ever fast increasing house price. In the first quarter of 2013， the house price in Beijing had the faste
11、st growth in the whole country. The leaders of Beijing seemed to get angered and“related the house price control with the relative governmental officials” ? anyone who failed to control the house price at bay could be accused and even sanctioned. The “negative relation between house price and govern
12、mental officials promotion” is worth spreading to the whole country， if this is more of the action than words. Anyway， this is ridiculous to sustain the positive relation between house price and governmental officials promotion. It is even more ridiculous， as the research revealed， that the more investment in environmental protection could affect the local officialsfuture career. It is the peoples livelihood and the NPC to decide who should be promoted or degraded， not the GDP.
