Welcome to my website!
I am Kangkai Wang, a Postdoctoral Fellow at the HKU Jockey Club Enterprise Sustainability Global Research Institute. I received my Ph.D. in Economics from the Guanghua School of Management, Peking University, in 2025.
As an urban economist, my research examines how space shapes economic behavior and market outcomes. I study how individuals make residential, employment, and consumption choices across space, how local amenities and environmental attributes influence these choices and are valued, and how spatial frictions affect the integration of markets. I address these questions using large-scale microdata and a combination of reduced-form and structural methods.
We disentangle two fundamental parameters underlying workers’ residence and workplace choices that shape urban commuting profiles: travel aversion and location adaptability. Using a quantitative spatial model that integrates travel mode and residence-workplace location choices, and a dataset of nearly 5 million bilateral routes across more than 200 Chinese cities, we find that both parameters vary substantially across cities. Travel aversion correlates with environmental factors, while location adaptability relates to the spatial organization of jobs and housing. A quantitative example of Shanghai suggests distinct general equilibrium implications of these two parameters. These findings point to micro-foundations for the commuting patterns that distinguish cities from one another.
On-the-job search puts employed workers in competition with the unemployed for the same vacancies, and it accounts for a comparable share of hires. We ask how a new subway changes a city’s matching efficiency when both groups are searching. Our setting is a northern provincial capital in China opening its first metro lines. A route-planning algorithm that switches the new lines on and off yields the metro-induced change in travel time between every pair of urban blocks. Deidentified cell phone records for roughly half a million residents provide monthly employment histories, including the origin and destination workplace of every job change. Blocks receiving larger time savings record higher employment and lower unemployment, with more entries into and fewer exits from employment, and more workers moving to a new workplace; matches between two blocks fall steeply with the commuting time between them, for unemployed and employed searchers alike. Embedding these estimates in a spatial search-and-matching model in which both types apply across the city and every application adds to the queue at the vacancy it reaches, we find that transit raises matching efficiency mainly by letting employed workers move to better-located jobs. Those moves in turn change the competition unemployed applicants face at every vacancy, and the resulting gains are spread unevenly across the city’s neighborhoods.
The economic consequences of climate change are typically studied at aggregate spatial scales, such as across countries or cities. This paper shifts the lens to within-city climate variation, or microclimate, and shows that it has important economic effects. Using satellite temperature data at 1 km resolution matched to transaction records from 89,040 restaurants in a major Chinese city, we estimate that a day of localized heat above 30°C reduces weekly restaurant revenue by roughly 7%, driven primarily by changes in consumer behavior rather than supply-side adjustments. To study how consumers adapt, we estimate a discrete choice model of restaurant demand incorporating microclimate amenities, travel costs, and prices. Consumers respond to local heat by shifting dining trips toward restaurants in cooler, greener areas, and we estimate their willingness to pay per meal for a 1°C reduction in dining-location temperature. This behavioral adaptation accounts for a large share of the reduced-form revenue losses. Counterfactual simulations indicate that existing urban green infrastructure contributes substantially to annual restaurant revenue citywide, with benefits that exceed the city’s investment in green space. Our results show that microclimate is an economically important source of urban business risk, and that ecological infrastructure offers substantial returns as a vehicle for climate adaptation.
Does market integration expand or contract the product lines of multiproduct firms? We study China’s cigarette industry, where provincial producers sell at nationally regulated prices and provincial governments shield local brands by controlling shelf access. Two reforms—a 5 percent destination-based wholesale tax introduced in 2009, raised to 11 percent in 2015 alongside a new specific tax per cigarette—reassigned cigarette tax revenue from producing to consuming provinces, eroding the fiscal motive for protection. Using a province–firm–year panel built from the universe of monthly sales records from 2010 to 2019, we show that the home-market premium of local producers falls by roughly 80 percent for high-end products after 2015 and is unchanged for low-end products. Producers respond by expanding variety: high-end launches per firm more than double, newly launched high-end varieties become substantially more available outside their home provinces, and the response is strongest among firms with small home markets and large baseline sales. A nested CES model with an endogenous protectionist government rationalizes these patterns: integration raises variety when the market-size effect of expanded access outweighs the competition effect.
Peking University, Teaching Assistant