Exploring the causes of informal housing in California cities from the demand side and supply side

In recent years, informal housing in developing countries has received widespread attention, but researchers have largely overlooked informality in developed countries, such as the United States. In fact, many types of informal housing exist in the United States. Recently, some scholars have devoted themselves to the research of informal housing in America, including its definition, types, and causes. However, none of them use quantitative methods to examine the potential causes of informal housing. This research aims to address this issue. In my study, I chose California cities as the unit of analysis due to the large numbers of informal housing units in California. With the definition of informal housing - housing units which are not permitted by local housing regulations or codes - I calculated the share of newly-built informal housing in California cities in the 2000s using previous scholars' methods. I then used fractional response regression models to examine the potential causes of informal housing produced from 2000 to 2010. The results reveal that informal housing arises both from the demand and the supply side. The variables on the demand side suggest that demographic factors - namely immigrants, Hispanics, and African Americans - play different roles in the production of informal housing. The lack of income on the demand side also results in informal housing. Additionally, on the supply side, the result suggests that the future housing provision and existing housing provision play an important role in the production of informal housing, while existing housing conditions, such as the share of single-family houses, is not related to informal housing production.