Land Revenue and Low-Rent Housing Provision: Local Political Economy of Affordable Housing Reform in China

Abstract

This article contributes to our understanding of the economic logic behind social policies in China. Low-rent housing provision is a welfare reform with large short-run fiscal implications. With empirical data, I show that local policy choices related to these issues are driven primarily by economic, not social, considerations. Because land for subsidized housing is allocated administratively without the land conveyance fees that constitute a major source of local government revenue, municipalities more dependent on real estate development have a stricter policy on low-rent housing allocation. This research draws on fieldwork interviews, content analysis of subsidized housing policies, and statistical analyses.