Informal government preferences and asymmetric land allocation in China

Whether governments have informal preferences toward firms when allocating land resources and the effects of such preferences on regional development remain unclear, particularly in countries with weak formal institutions. This paper investigates the government’s informal preferences in land allocations in China. Substantial evidence is found that politically connected firms are preferred to win land auctions at lower prices due to two different reasons. These preferences are informally achieved through a two-stage auction mechanism rather than formal bid preference programs, and result in the asymmetrical allocation of urban land in terms of land quality, quantity, and price, across politically and non-politically connected firms in China. The state-owned enterprises are allocated poor quality land parcels at 55% land price discounts. In comparison, the manager-based politically connected firms are allocated regular land parcels at 6% price discounts, and other firms without connections with the government are allocated regular land at higher prices.     

Land use policy in China: Introduction

This themed issue of Land Use Policy builds mainly on papers presented at an international conference on ‘Land Use Issues and Policy in China under Rapid Rural and Urban Transformation’, convened by the Chinese Academy of Sciences in Beijing, China, in October 2012. The conference set out to share and promote new scientific findings from a range of disciplines that advance research on land use policy in China. The contributions to this themed issue provide conceptual–theoretical and empirical takes on the topic, around four main areas of interest to both researchers and policymakers: nation-wide land use issues, the Sloping Land Conversion Program, land engineering and land use, and land use transitions. Various land use issues have been associated with rapid urban–rural transformations in China, giving rise to formulation of new policies directly affecting land use. However, these have contributed to new land use problems due to the nature of the policies and the difficulties in policy implementation constrained by the special ‘dual-track’ structure of urban–rural development in China. In view of this, this themed edition makes a compelling call for more systematic research into the making and implementation of China's land use policy. It also emphasizes the challenges for further research on land use policy in China.     

Urban spill over vs. local urban sprawl: Entangling land-use regulations in the urban growth of China's megacities

Rather than a bad case of urban sprawl, the physical expansion of China's megacities may be viewed as a combination of ‘urban spill over’ and ‘local urban sprawl’. This paper reviews land use regulations in their institutional context and argues that conflicts in land use regulation are related to ideologies of land ownership and embedded in different planning doctrines. These hypotheses are investigated with special reference to Guangzhou, the capital of Guangdong Province in southern China. The evidence suggests that entangled land use regulations for “urban” and “rural” land have imposed serious constraints on urban growth, while the contradictions of different policies and regulations in the use of rural lands for urban construction have led to intensive and unhealthy competition among stakeholders. As a result, not only have the costs of land conversion from rural to urban uses increased, but the spatial development of Guangzhou has been distorted. The implications of these failures for future policy are discussed with emphasis on the reform of the land use regulation system.     

Urban lake spatial openness and relationship with neighboring land prices: Exploratory geovisual analytics for essential policy insights

Possessing ecological service functions, as well as social and economic values, urban lakes are an important part of urban open spaces. The improvement in the openness of urban lakes is crucial to enhancing the efficiency and fairness of urban land use. Accompanied by China's rapid urbanization, China's urban land prices continue to rise and the government relies on land finance. Meanwhile, the number of urban lakes is decreasing, the lake water surface area is shrinking, and water pollution is becoming more serious. By using exploratory indicators, this study quantifies the degree of openness of urban lakes, and focuses on the relationship between lake spatial openness and neighboring land prices. Taking Wuhan (China) as a study case, we proposed a conceptual framework to guide the analysis within the context of land use policy. Then, we created exploratory indicators to quantify the spatial openness of urban lakes and mapped the results. Afterward, we conducted an exploratory geovisual analytics of urban land prices and lake spatial openness. Finally, we used a regression model to examine the relationship between prices and openness. Our results show that our new indicators were able to reflect the openness of the lakes in the central urban area of Wuhan simply and effectively. The overall spatial openness is relatively high, the mean values of two main indicators reflecting the openness percentage of the lakes are 69.91 % and 67.57 % respectively. However, there are still obvious regional differences between the openness indicators. The relationship between openness and neighboring land prices is spatially heterogeneous. Based on our analysis, we finally propose policy suggestions for protecting urban lakes and rational land use in the rapid urban expansion occurring in developing countries.     

NIMBYism in China: Issues and prospects of public participation in facility siting

Not-in-my-backyard (NIMBY) protests have been on the rise in urban China over the past few years. Previous studies have focused on campaign strategies and outcomes, yet less attention has been paid to how the Chinese government at different levels has responded to NIMBY protests. This paper focuses on the controversies over three paraxylene (PX) chemical plant projects, which were considered as growth engines by local governments but as health and environmental threats by local residents. It adopts the analytical framework of divided state power to explain why local governments chose to make concessions to the public's demands to relocate or cancel these PX projects. The study finds that the mandate to maintain social stability incentivized local governments to address NIMBY concerns in an ad hoc manner, which tended to create more problems than solutions. The central government has introduced several institutional measures to formalize public participation in land use planning and to hold local governments more responsible for environmental decisions. The analysis of multi-level government responses to NIMBY protests provides a new insight into the power structure that enables or constrains public participation in facility siting in China.     

选择性供地、工业结构调整与城市创新

研究目的：基于土地市场交易和城市创新指数数据,从工业结构调整视角,探讨地方政府选择性供地对城市创新的影响效应及其作用路径。研究方法：中介效应模型,面板门槛模型。研究结果：地方政府选择性供地能显著提升城市创新水平,尤其是对经济发达的东部地区促进作用更明显。中介效应检验表明,工业结构调整是地方政府选择性供地影响城市创新的重要路径,同时该影响路径存在非线性效应,即当工业结构优化度超过门槛值时,选择性供地对城市创新具有更为显著的促进作用。研究结论：应结合地区发展定位和比较优势引导地方政府合理选择供地策略,完善财税制度和政绩考核体制,约束地方政府无差别供地行为;完善工业用地差别化供给政策,构建企业准入门槛体系,引导地方政府选择性供地策略促进城市创新发展。     

The incentives of China's urban land finance

Land grant premiums and land tax revenues have become two major sources of fiscal revenue for city governments in China. This type of fiscal revenue strategy for city governments is generally referred to as “land finance”, and it has drawn increasing research attention in recent years. This paper explores the institutional causes of the “land finance” strategy of city governments in China. We first analyze the institutional foundation of “land finance” (including China's urban land use system and land expropriation system). We then propose two hypotheses about the institutional causes of “land finance”. The first hypothesis is that the current system of fiscal decentralization is a major reason city governments choose the “land finance” fiscal strategy. The second hypothesis is that under the current personnel control system, which uses local economic performance as the most important indicator for evaluating local government officials, the competition between city governments to promote local economic growth is another major reason city governments choose the “land finance” fiscal strategy. We test the hypotheses by estimating econometric models using data for 31 provincial-level regions for the period 1999–2008. The empirical results suggest that fiscal decentralization and competition between city governments to promote economic growth are two major causes of “land finance”.     

Land management institution as a key confinement of urbanization in Baotou,China⿿Application of proposed endogenous urbanization model

China has been experiencing rapid urbanization, with a large amount of rural land converted into urban land, leading to debate by researchers and governments. This study investigates the endogenous factors influencing urban expansion and quantifies their effects to promote intensive and sustainable urban land use in order to realize new-type urbanization, by employing GIS technology and an endogenous growth model. The simulation results explain the expansion of urban land in the case of Baotou city, China. The result shows that the land management institution(LMI) has played a critical role in urban land expansion in Baotou city. Its multiplier effect reaches 0.166, which means a one percentage point increase in the strength of LMI leads to a 0.166% increase in urban land area. The presented analysis reveals four main findings. Firstly, the major factors influencing urban expansion are (LMI), urban disposable income per capita, the secondary and tertiary industry, technological progress, and population density. Secondly, LMI has a critical influence on urban expansion. Thirdly, technological progress has a positive effect on urban expansion by merging into the secondary and tertiary industry. Finally, population density and the tertiary industry have a dampening effect on urban expansion. According to the analysis, we suggest that the central government in China should regulate the behavior of local governments to reduce principal⿿agent risk, as they hold the state land property rights as the trustee of the public. Meanwhile, the government should pay more attention to guiding technological progress by promoting industrial transformation and economic quality, not just focusing on economic quantity, especially for resource-based cities.     

Planning consistency and implementation in urbanizing China: Comparing urban and land use plans in suburban Beijing

The evaluation of the extent to which urban and land use planning have achieved their objectives is crucial to better management of urban land development. China’s urban and land use plans have the common purpose of controlling urban sprawl. This research aimed at comparatively assessing the consistency and implementation of these plans, considering the Changping District in suburban Beijing as a case study. Three main findings were obtained: (1) each plan used different strategies to control new developments, and there were several quantitative and spatial conflicts between the two plans; (2) neither plan has been well implemented or effective in controlling urban sprawl, despite the slightly better performance of the land use plan; (3) core-periphery decreasing trends were revealed in land quota allocation and effectiveness of planning implementation. Remote regular towns received the least land resources from the top-down planning system but also developed fast, mainly through informal and illegal approaches. Further investigation into the double failure of China’s current spatial planning system in quantitative and spatial control over urban land development requires a deeper integration of various spatial management systems, a fundamental transformation of planning philosophy, and a higher respect for peripheral areas in urban-rural integration. The planning assessment approach and reform recommendations developed on the basis of the Chinese practice are probably referable for other developing countries facing similar processes of rapid urbanization and imperfect spatial management.     

Scenario simulation of land system change in the Beijing-Tianjin-Hebei region

Urbanization-induced land use problems have been haunting China’s urban agglomerations ever since the beginning of this period of unparalleled economic progress. The Beijing-Tianjin-Hebei (BTH) region is no exception, where coordinated development planning has been implemented by the central government to further resolve attributed problems. Land use simulation models can be used to help governments and planners understand how planning and policies affect the future landscape, by developing sustainable land use strategies which may reasonably balance urbanization and eco-environmental protection. In this paper, we explored the characteristics of historical land use dynamics from 2000 to 2015 in the BTH region and simulated its future land use patterns for 2030 by combining the Dyna-CLUE model with a Markov model to deal with some short comings of existing land use models. The main conclusions are as follows: (1) The figure of merits (FoM) based on the method of three-map comparison reached 85.89 %, which indicated that the simulation model has satisfactory accuracy. (2) Land use structures and spatial patterns differed significantly under business as usual (BAU) scenario, cropland protection (CP) scenario and ecological security (ES) scenario, respectively, owing to the variation of the major objectives designed for different scenarios. (3) By scenario analysis and through tradeoffs, the land use mode under the ecological security scenario might be the optimal solution for future coordinated development in the BTH region. These results will provide theoretical basis and meaningful guidance for regional land optimal allocation.     

Industrial land price and its impact on urban growth: A Chinese case study

China is experiencing rapid progress in industrialization, with its own rationale toward industrial land development based on a deliberate change from an extensive to intensive form of urban land use. One result has been concerted attempts by local government to attract foreign investment by a low industrial land price strategy, which has resulted in a disproportionally large amount of industrial land within the total urban land use structure at the expense of the urban sprawl of many cities. This paper first examines “Comparable Benchmark Price as Residential land use” (CBPR) as the theoretical basis of the low industrial land price phenomenon. Empirical findings are presented from a case study based on data from Jinyun County, China. These data are analyzed to reveal the rationale of industrial land price from 2000 to 2010 concerning the CBPR model. We then explore the causes of low industrial land prices in the form of a “Centipede Game Model”, involving two neighborhood regions as “major players” to make a set of moves (or strategies). When one of the players unilaterally reduces the land price to attract investment with the aim to maximize profits arising from the revenues generated from foreign investment and land premiums, a two-player price war begins in the form of a dynamic game, the effect of which is to produce a downward spiral of prices. In this context, the paradox of maximizing profits for each of the two players are not accomplished due to the inter-regional competition of attracted investment leading to a lose-lose situation for both sides’ in competing for land premium revenues. A short-term solution to the problem is offered involving the establishment of inter-regional cooperative partnerships. For the longer term, however, a comprehensive reform of the local financial system, more adroit regional planning and an improved means of evaluating government performance is needed to ensure the government's role in securing pubic goods is not abandoned in favor of one solely concerned with revenue generation.     

Urban proximity,demand for land and land shadow prices in Malawi

We assess the spatial and intertemporal variation in farmland prices using per hectare minimum willingness to accept (WTA) sales and rental (shadow) prices in Malawi. We use three rounds of nationally representative farm household panel data from the Living Standards Measurement Surveys (LSMS), collected in 2010, 2013 and 2016. The sample is split in quintiles based on distance from the nearest major city, building on the land valuation and transaction cost theory, and agrarian political economy perspectives on global and national land transactions. Generally, farmland shadow prices decrease with distance from urban areas. However, farmland shadow sales prices increased more sharply between 2010 and 2013 in rural areas (+100 % vs +30 % in urban proximity). The results indicate that the sharp increase in demand for large-scale land transfers following the sharp increase in energy and food prices also affected rural smallholders’ land valuation, even in remote rural areas of Malawi. Conversely, by 2016 land shadow sales prices were again, like in 2010, about three times as high in areas near urban centres compared to remote rural areas. Even though sales prices declined in remote rural areas from 2013 to 2016, rental prices remained high. Using farm household-level population pressure variable, we show that local population pressure is a driver of farmland shadow prices, indicating land scarcity challenges, growing demand for land, and poorly developed land markets. With increasing land scarcity, land markets are becoming more important and need to be factored in when formulating development policies that aim to improve access to land in both peri-urban and rural areas.     

Central versus local states: Which matters more in affecting China's urban growth?

To date, many geography studies have identified GDP, population, FDI, and transportation factors as key drivers of urban growth in China. The political science literature has demonstrated that China's urban growth is also driven by powerful economic and fiscal incentives for local governments, as well as by the political incentives of local leaders who control land use in their jurisdictions. These parallel but distinct research traditions limit a comprehensive understanding that can result in partial and potentially misleading conclusions of urbanization in China. This paper presents a spatially explicit study that incorporates both political science and geographic perspectives to understand the relative importance of hierarchal administrative governments in affecting urban growth. We use multi-level modeling approach to examine how socio-economic and policy factors – represented here by fiscal transfers – at different administrative levels affect growth in “urban hotspot counties” across three time periods (1995–2000, 2000–2005, and 2005–2008). Our results show that counties that are more dependent on fiscal transfers from the central government convert less cultivated land to urban use, controlling for other factors. We also find that local governments are becoming more powerful in shaping urban land development as a result of local economic, fiscal, and political incentives, as well as through the practical management and control of capital, land, and human resources. By incorporating fiscal transfers in our analysis, our study examines a factor in the urban development of China that had previously been neglected and provides an improved understanding of the underlying processes and pathways involved in urban growth in China.     

China’s local governments breaking the land use planning quota: A strategic interaction perspective

In China, the planning quota, i.e., the binding target of construction land (BTCL) in land use planning for 15 years (2006–2020), was exhausted within only 7 years, which represents a very serious problem. This result not only nullifies the meaning of the plan itself but also threatens China's food and ecological security and poses great challenges to sustainable development. Here, we develop an analysis framework for local governments that break the BTCL in view of the strategic interactions of transferring newly increased construction land (NCL) among local governments and perform an empirical analysis of data on 262 prefecture-level cities from 2007 to 2016. The two main conclusions are as follows. First, adjacent local governments engage in positive strategic interactions regarding the quantity of NCL transferred. Second, positive strategic interactions regarding the quantity of NCL transferred are important reasons why local governments break the planning quota. In addition, we find that better economic development corresponds to more obvious positive strategic interactions. We also find that fiscal incentives and land misallocation play a significant role in promoting the increase in NCL, while strengthening land law enforcement can effectively constrain the increase in NCL. This paper enriches the literature on the reasons for planning failures, extending the research perspective to the level of interaction effects among local governments, and this paper provides new evidence regarding the strategic interaction among Chinese local governments. Moreover, this paper provides an important new path for the central government to constrain urban land expansion and to control the behavior of local governments that break the planning quota.     

Stakeholder perceptions and governance challenges in urban protected area management: The case of the Las Piñas – Parañaque Critical Habitat and Ecotourism Area,Philippines

The conservation and management of protected areas in urban settings has become increasingly challenging with dynamics over land use change in adjacent urban areas being highly relevant to, but at times conflicting with, the protected area. This study seeks to better understand the implications of land use change processes to urban protected area management through the case study of the Las Piñas – Parañaque Critical Habitat and Ecotourism Area (LPPCHEA) in Metro Manila, Philippines. Factors and processes influencing land use change and protected area management and the impact of stakeholders’ perceptions on protected area were analyzed. The urban protected area in itself has limited influence on its surrounding urban areas, as land use change in these areas is shaped more by social, economic and policy/institutional factors occurring within the context of urban-regional development. The study also found that land use conflict is evident in an urban protected area due to the competing ecosystem services derived by various stakeholders. This discord is deepened by the lack of coordination between land use planning and protected area management. Integrating protected area management with land use planning through legally binding instruments, specific timeframes and clear internal procedures can help resolve land use conflict for an urban protected area at the strategic or policy level.     

我国土地利用和管理形势政策研判

目前土地利用和管理的政策重点为:调结构、调过剩产能、完善城乡统筹中土地制度,严格保护耕地.针对资源供应的刚性影响逐步扩大,全社会的发展理念发生着深刻的变化,为提高资源利用效率、走节约集约道路提供了良好的外部环境.应该供需双向调节,加速结构调整、统筹城乡发展,促进城市转型,加快宜居城市建设、实施建立差别化供地政策、强化耕地建设性保护专项工作.对2011年来讲,促进经济发展方式转变,节约集约用地是关键,严格保护耕地是硬任务,应推动土地利用方式根本转变.促进经济发展方式转变和经济社会又好又快发展.     

The impact of different land-supplying channels on the supply of housing

As Hong Kong's property prices have been skyrocketing particularly in the last several years, housing has become even less affordable than it was prior to the Asian Financial Crisis, compromising Hong Kong residents’ living standards. The general public mostly blames the supply-side actors (i.e. property developers and/or the government) for such a predicament, and vociferously demands for higher supply of residential flats both in the private and public sectors. The government, in response, proposes the supply of more residential land, among other measures, in addressing the public's demands, with the notion of “higher land supply results in higher housing supply”. Nonetheless, there are other channels, other than land sale, which provide land for housing construction, such as land exchange, which are usually overlooked in public debates. In the light of this, this paper aims to investigate the respective impact of land sale and land exchange on Hong Kong's housing supply. The findings, interestingly, show that land exchange has a much larger long-run impact on housing supply than land sale does; that housing supply responds to short-run fluctuations in property price; and that best lending rate has neither a short- nor long-run relationship with the supply of housing. The reason behind the finding regarding land sale and land exchange is that, the former is initiated by the government which overlooks property developers’ profit incentives and development strategies, while the latter essentially reflects that a particular land site is ripe for development (i.e. profitable) from the developers’ standpoint. Some implications relating to the recently announced government land policy measures are also discussed.     

The impact of anti-corruption measures on land supply and the associated implications: The case of China

The allocation of land resources is a crucial issue in sustainable urban development, but it is subject to the vagaries of public governance. By using the prosecution of corrupt local leaders as the shock event, and exploring the data on sacked officials and land transfers in prefecture-level cities in China from 2006 to 2016, we analyse the changes in the supply of land in response to the ousting of key local officials for corruption. The estimations derived through the identification strategy of the DID framework show that both the volume and value of land sales dropped significantly after the local officials’ ousting, with the value of total land sales reacting to a much greater extent. We also found the reduction of land supply was mainly from commercial and residential land but a greater supply of land for public use following the local leaders’ ousting, accompanied with an increase in the level of marketisation in the supply of land and a reduction in cheap transfers of industrial land. In addition, the heterogeneity of the effect across the rank and type of official was investigated, and the long-term persistence of this effect was confirmed. By showing that anti-corruption measures have a persistent disciplinary effect on officials’ subsequent land supply strategy, this paper underscores that the quality of public governance profoundly influences the functioning of the land market.     

Land for welfare in China

Drawing on firsthand observations, Party and government documents, and survey data, this study examines the causes and processes of the land for welfare policy in China. The implementation of the land for welfare program cannot be understood in isolation from the profound urban–rural gap in the land property rights regime and social welfare provision in China. The dual land tenure system allows local officials to generate revenue by expropriating rural land, which, to rural households, functions as a social insurance as well as an income-generating property. In the process of land requisition, land-losing villagers are provided with social welfare benefits to compensate for their loss of their land's insurance function. Such provision, however, is not developed out of the local governments’ benign intention, but their strategic reaction to the central government's development program that combines rural social welfare provision with a land rewarding system, which provides an opportunity for local officials to gain more land, a valuable asset for local governments. The provision of social welfare benefits is selective: affected rural households are provided with welfare benefits that are less costly to the local government, typically in the form of a pension insurance.     

2021年土地科学研究重点进展评述及2022年展望 ——土地经济分报告

研究目的：梳理并比较2021年国内外土地经济领域的研究进展和研究重点,展望未来研究方向。研究方法：文献分析法。研究结果：2021年,国内研究集中于城市土地利用效率、城市土地供给、农地流转机制建设、土地价格的空间分布、土地要素市场化、产权安全效应、产权制度创新、土地征收补偿以及宅基地制度改革等问题;国外研究重点关注城市土地价格的影响因素、土地市场与农业发展、土地市场参与主体与土地利用效率、产权安全与农业生产效率、土地制度改革的减贫效应等。研究结论：土地经济研究的深度和广度得到了拓展,土地经济研究需要进一步结合中国国情,着力探索理论创新,为形成有中国特色的土地经济理论、更好地为新时代土地制度改革服务而努力。2022年《中国土地科学》将重点关注土地经济基础理论探索、土地市场波动的理论与实证研究、土地要素市场化机制设计、土地制度改革配套政策、确权登记颁证进展与绩效评估、重要改革试点的跟踪与评价等。