Interpreting the Development of Urban Construction Land in China

Abstract

In view of the drastic growth and inefficient utilization of UCL in China, it is unsurprising that the driving forces and mechanisms behind China’s UCL development have long been a subject of great scholarly interest. This chapter critically reviews three influential interpretations with insightful theoretical engagement and rich empirical support, including the demand-driven, political economy, and property rights frameworks. First, the conventional wisdom that highlights the demand side of urban land market tends to see rapid UCL expansion in China simply as a derived outcome of economic growth and population agglomeration in urban areas. Second, a political economy framework has been developed to understand China’s UCL development from the behaviors of local governments on the supply side. Specifically, research from this perspective emphasizes two motivations of local governments: to alleviate the increasing fiscal pressures after the tax-sharing reform by gaining extra-budgetary land sale revenue, and to promote urban economic growth by using low-priced industrial land as an important means to attract domestic and foreign investments. Third, some studies from the neoliberal perspective have attributed the rapid growth and inefficient utilization of UCL to the lack of clarity and protection in property rights. All the three frameworks present their respective interpretations to explain the massive UCL development in reforming and urbanizing China. After a critical and detailed review of such interpretations, this chapter demonstrates their common limitations such as the wide ignorance of the role played by the peasantry as the original owner and user of the UCL, the unconditional acceptance of the neoliberal ideology, the lack of a systematic analysis of the interactions among multiple actors with distinctive interests, and the limited attention paid to the region-specific development environments and their fundamental roles in shaping the localized characteristics of interest differentiation, power distribution, and interactions among multiple land-related actors.