Urban Land Issues and Policy Challenges in China's Rapid Urbanization

Abstract

This paper discusses land issues and attempts to explain why they are persistent and prevalent in Chinese cities. We will demonstrate that the factors behind the land issues include land institution setting, gradualism in reforms, illdesigned policy instruments, one-size-fits-all approaches to land management, a fragmented planning system, and development objectives that are conflicting among themselves at the national level. We then discuss land policy challenges and unfinished reforms that deserve attention. Land reforms underscore the balancing act required between the concerns about the protection of property rights and public interests. They were meant to address the entitlement question of unearned land value increments, minimize social welfare losses in farmland protection, and add planning/policy flexibility to cope with future development uncertainty. Finally, we illustrate the challenges in policy choices and the importance of the political will/determination of top leaders at all levels of government in undertaking radical and fundamental land policy reforms. Political will/determination would be critical in land policy reforms because leaders will face rising political resistance and huge socioeconomic costs.