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Balancing act: Economic incentives, administrative restrictions, and urban land expansion in China

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  • Feng, Juan
  • Lichtenberg, Erik
  • Ding, Chengri

Abstract

We examine how the system of “federalism, Chinese style” functions in the context of land allocation. China's land laws give provision of land a central role in local officials' growth promotion strategies. Requisitions of farmland by local authorities have engendered significant rural unrest. In response, the central government has attempted to re-establish control over the pace of urban land expansion by enacting regulations limiting conversion of rural land to urban uses. We derive theoretically the conditions under which non-compliance with such regulations is optimal. An econometric investigation shows that legal restrictions on farmland conversion had little or no effect on rates of farmland loss but did limit urban spatial growth. Our econometric evidence is consistent with limited enforcement of those legal limits on farmland conversion.

Suggested Citation

  • Feng, Juan & Lichtenberg, Erik & Ding, Chengri, 2015. "Balancing act: Economic incentives, administrative restrictions, and urban land expansion in China," China Economic Review, Elsevier, vol. 36(C), pages 184-197.
  • Handle: RePEc:eee:chieco:v:36:y:2015:i:c:p:184-197
    DOI: 10.1016/j.chieco.2015.09.004
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    1. repec:gam:jsusta:v:10:y:2018:i:9:p:3077-:d:166474 is not listed on IDEAS
    2. repec:gam:jsusta:v:10:y:2018:i:3:p:798-:d:136117 is not listed on IDEAS
    3. Yunfei Peng & Jing Qian & Fu Ren & Wenhui Zhang & Qingyun Du, 2016. "Sustainability of Land Use Promoted by Construction-to-Ecological Land Conversion: A Case Study of Shenzhen City, China," Sustainability, MDPI, Open Access Journal, vol. 8(7), pages 1-16, July.

    More about this item

    Keywords

    Decentralization; Dynamic balance policy; Fiscal federalism; Land allocation; Farmland preservation;

    JEL classification:

    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • P35 - Economic Systems - - Socialist Institutions and Their Transitions - - - Public Finance
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment

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