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Harnessing the Forces of Urban Expansion: The Public Economics of Farmland Development Allowances


  • Nancy H. Chau
  • Weiwen Zhang


For decades, rapid urban expansion has led to concerns over the loss of cultivated land in rural China. This contrasts sharply with another salient feature of the Chinese land policy reform landscape that has gone on largely unnoticed: the addition of newly cultivated land in China through land development has consistently exceeded land conversion. In a model featuring fiscal decentralization, plus local governments as custodians of land use and development, along with a land development allowance policy instituted in 1998, we show that a land development allowance policy can harness the forces of urban expansion to encourage agricultural land development.

Suggested Citation

  • Nancy H. Chau & Weiwen Zhang, 2011. "Harnessing the Forces of Urban Expansion: The Public Economics of Farmland Development Allowances," Land Economics, University of Wisconsin Press, vol. 87(3), pages 488-507.
  • Handle: RePEc:uwp:landec:v:87:y:2011:iii:1:p:488-507

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    References listed on IDEAS

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    Cited by:

    1. Dennis Rodgers & Jo Beall & Ravi Kanbur, 2011. "Latin American Urban Development into the 21st Century Towards a Renewed Perspective on the City," WIDER Working Paper Series 005, World Institute for Development Economic Research (UNU-WIDER).
    2. Wen Wang & Fangzhi Ye, 2016. "The Political Economy of Land Finance in China," Public Budgeting & Finance, Wiley Blackwell, vol. 36(2), pages 91-110, June.
    3. Khantachavana, Sivalai V. & Turvey, Calum G. & Kong, Rong & Xia, Xianli, 2013. "On the transaction values of land use rights in rural China," Journal of Comparative Economics, Elsevier, vol. 41(3), pages 863-878.

    More about this item

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy


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