Governance Structure of Rural Homestead Transfer in China: Government and/or Market?

Yongchao Zhang,Marianne Ehrlich,André Torre

doi:10.3390/land10070745

Abstract

Rapid urbanization in China has triggered the mass migration of rural populations to cities. These policies have resulted in a shortage of construction land for the urban population and in an inefficient use of rural homestead, causing a tremendous waste of rural land resources. Rural homestead transfer has been identified as a tool to solve this problem: the saved construction land can be reclaimed to cultivated land, and the construction rights are transferred to urban areas, where they can be used to build new households for the demanding population. We consider that transaction costs analysis can help understand the governance structures of the homestead processes, and provide avenues for further research and policy recommendations. Our article draws on the practices and experiences gained in three areas in rural China (Jinzhai, Yiwu, and Jiangning in the Anhui, Zhejiang, and Jiangsu Provinces, China). Based on the empirical cases and information produced from the villages and households survey, we developed an analytical framework of transaction cost. Results suggest that Yiwu has lower assets specificity, lower uncertainty, and transaction frequency, hence the market driven model played a major role. In Jinzhai, which presents higher assets specificity, higher uncertainty, and transaction frequency, the government-oriented model also played a major role. In Jiangning, where most transaction attributes are situated in the middle, the mixed-oriented model acted as a main role in the local area. Our conclusion shows that various governance structures are appropriate for different areas of rural China, which is significantly related to the local transaction attributes. We suggest promoting the governance structure which corresponds to the local resource endowment, human and residential condition, the cultural atmosphere, and also the institutional (official) atmosphere. Matched with the government or/and market governance structure, it may develop the resource allocation efficiency and improve economic performance.

Highlights

Like in any other country, rapid urbanization in China has triggered the mass migration of rural populations to cities
To make the investigation of the diverse forms of possible homestead transfer, we selected three case villages: (a) one in a region characterized by an advanced economy (Yiwu, Zhejiang province); (b) the second one in a region characterized by a developing economy (Huanglonxian, Jiangning region, Nanjing city, Jiangsu province); (c) the last one located in a region with an underdeveloped economy (Jinzhai, Anhui province)
The goal of this article was to define a suitable classification of governance structures for rural homestead transfer in three different areas in China, in order to guarantee high performance and develop allocation efficiency, to explain its rationality, and to find possible improvement plans to choose the suitable governance structure for each area

Summary

Introduction

Like in any other country, rapid urbanization in China has triggered the mass migration of rural populations to cities. If the urban construction leads to an increase of land use in the suburbs of the city, a corresponding amount of construction land must be re-cultivated in the countryside.), which strictly controls the growth of construction land and balanced it with the development of cultivated areas Due to these policies, it resulted in a shortage of construction land for the urban population and in an inefficient use of rural homestead [1], with the phenomenon of “hollowing villages” and vacant residential houses, causing a tremendous waste of rural land resources [2,3]. It resulted in a shortage of construction land for the urban population and in an inefficient use of rural homestead [1], with the phenomenon of “hollowing villages” and vacant residential houses, causing a tremendous waste of rural land resources [2,3] This contradiction between land supply and demand has become 4.0/). The saved construction land can be reclaimed to cultivated land, and the construction rights are transferred to urban areas

Objectives

Methods

Results

Discussion

Conclusion