<![CDATA[Urban economic growth can enhance productivity and employment while intensifying pressure on housing markets, raising questions about whether housing-price appreciation remains proportionate to improvements in metropolitan economic performance. This study examines the relationships among employment, labour productivity, and house-price indices using an unbalanced panel of 600 city-year observations for 35 OECD functional urban areas in 11 countries between 2000 and 2023. A house-price-productivity gap is constructed from rebased house-price and labour-productivity indices to identify periods in which housing-price growth outpaces productivity growth. Two-way fixed-effects models, first-difference estimation, and sensitivity analyses examine within-city co-movement while accounting for persistent metropolitan characteristics and common temporal shocks. Annual house-price growth is positively associated with contemporaneous employment and productivity growth. In the levels specification, a 10% increase in employment is associated with 3.2% higher labour productivity and a 0.132-log-point increase in the house-price-productivity gap, equivalent to a 14.1% increase in the index ratio. The gap coefficient is an accounting implication of the productivity and house-price equations rather than an independent causal effect. Results remain positive across samples, denominators, and fixed-effects specifications, although their magnitudes vary substantially. The findings demonstrate that urban economic expansion and housing-market appreciation frequently move together but do not necessarily proceed at comparable rates. The price-productivity gap therefore provides a transparent diagnostic indicator of metropolitan divergence rather than a measure of housing affordability or welfare. Its application can identify urban areas where employment growth, productivity performance, and housing-market change warrant detailed investigation of housing supply, land-use conditions, household incomes, and distributional outcomes.]]>
