Limited Decentralization: Understand China’s Land System from the Perspective of Central-Local Relation

Central-local relation is a critical but overlooked perspective for understanding China’s land system. During the last decades, the central government has decentralized considerable autonomy of land development to local governments to encourage the latter to adopt their advantages in local information for economic growth. However, the local government pursues more development-oriented goals, leading land to be an endowment for jurisdiction competition, fiscal revenue maximization, and officials’ career advancement at the local level. The discretion of local government, however, is constrained by the central authority. Land quotas, land approval, and, perhaps most importantly, nomenklatura, all of which are controlled by the central government, undermine the credibility and irreversibility of decentralization. We call such a central-local relation limited decentralization, a framework that could be applied to explain a range of land issues such as farmland protection and real estate regulation. Although we believe the central government is the principal determinant of the degree of decentralization, we also acknowledge that the initiative of local governments is essential. The interactions between central and local governments result in rights definition, power distribution, and, consequently, land use policy change over time.