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Urbanization and land finance dependence: Insights from China

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  • Chen, Shi
  • Tian, Chao
  • Dong, Siyuan
  • Shu, Tianheng
  • Huang, Yixiong
  • Huang, Meiying

Abstract

The “new” urbanization process has transformed China's traditional urban development model and is gradually becoming the principal driver of integrated economic, social, and environmental growth. This study treats the new-type urbanization (NTU) pilot strategy as a quasi-natural experiment and measures prefecture-level cities' dependence on land finance using panel data from 2006 to 2022. Employing a staggered difference-in-differences approach, it examines the impact of NTU on land finance dependence and explores potential mechanisms. The results show that NTU significantly reduces land finance dependence. Furthermore, this positive effect is more pronounced in resource-based cities, areas with lower land-utilization efficiency, higher human capital, and lower carbon emissions. Mechanism tests indicate that NTU mitigates land finance dependence by enhancing entrepreneurial vitality, innovation activity, and economic resilience. From the perspective of China's modernization path, the findings provide practical evidence for high-quality regional development and offer insightful policy recommendations.

Suggested Citation

  • Chen, Shi & Tian, Chao & Dong, Siyuan & Shu, Tianheng & Huang, Yixiong & Huang, Meiying, 2025. "Urbanization and land finance dependence: Insights from China," Economic Modelling, Elsevier, vol. 152(C).
    • Handle: RePEc:eee:ecmode:v:152:y:2025:i:c:s0264999325002482
    DOI: 10.1016/j.econmod.2025.107253
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