Land Leasing and Local Public Finance in China’s Regional Development: Evidence from Prefecture-level Cities

2010/03/11 by Ran Tao, Fubing Su, Mingxing Liu +2 · 482 citations
Economics, Econometrics and Finance · Social Sciences · #Business #China #China's Socioeconomic Reforms and Governance #Competition (biology) #Economics #Finance #Fiscal Policy and Economic Growth #Geography #Incentive #Investment (military) #Local Government Finance and Decentralization #Local government #Macroeconomics #Market economy #Negotiation #Panel data #Political science #Politics #Public finance

paper · doi:10.1177/0042098009357961

published in Urban Studies 47(10), 2217-2236 (SAGE Publishing)

openalex publication_date 2010/03/11 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/26

Abstract

By analysing the evolution of local governments’ roles in different periods of China’s growth in transition, this paper explores local fiscal incentives to use subsidised land and infrastructure as key instruments in regional competition for manufacturing investment since the mid 1990s. Local land development behaviour is related to China’s current land use institutions and intergovernmental arrangements. On the basis of panel data covering prefectural-level cities from 1999 to 2003, the paper empirically identifies and compares the fiscal impacts of different forms of land leasing (by negotiation versus by auction/tender). Policy implications are drawn from this analysis, for the further reform of China’s urban land system and fiscal institutions.

Citations

• Theories of Tax Competition
• The State, Land System, and Land Development Processes in Contemporary China
• Fiscal Decentralization and Economic Growth in China
• A Pure Theory of Local Expenditures

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